Microsoft resolved a critical Azure CLI upgrade failure affecting Windows users, where missing Python extension files caused crashes. The fix includes both a root cause analysis and significant MSI performance improvements.
Azure CLI users on Windows recently encountered a frustrating upgrade issue that caused immediate crashes after installing newer versions. The problem, which affected upgrades from Azure CLI 2.76.0 to 2.77.0 and later, resulted in the error: "ImportError: DLL load failed while importing win32file: The specified module could not be found." This post breaks down who was affected, what caused the issue, and how Microsoft resolved both the crash and upgrade performance problems.
Who Was Affected?
You likely encountered this issue if you:
- Installed Azure CLI using the Windows MSI installer
- Upgraded from Azure CLI 2.76.0 or earlier to 2.77.0 or later
- Did not perform a complete uninstall before upgrading
After the upgrade, any az command would fail immediately with the win32file import error.
Immediate Recovery Steps
Microsoft recommends upgrading to the latest version (2.83.0) as the quickest fix. For those needing to install other versions, a clean reinstall is necessary:
- Uninstall "Microsoft Azure CLI" from Windows Settings → Apps
- Delete any remaining installation folders (such as the CLI2 directory)
- Reinstall the latest Azure CLI using MSI or winget
- Verify installation with
az --version
Root Cause Analysis
The issue stemmed from an interaction between Windows Installer file versioning rules and a third-party dependency change. During the affected MSI upgrade, the installation directory ended up missing critical native Python extension files (.pyd files) required by the Windows integration layer.
MSI logging revealed that components were being blocked because Windows Installer believed the existing (older) key files were "newer" than the incoming ones. The specific sequence:
- Azure CLI 2.76.0/2.77.0 used pywin32 311
- pywin32 311's .pyd binaries were missing Windows version resource metadata
- Previous Azure CLI builds contained version-stamped pywin32 binaries (e.g., pywin32 306)
- MSI treated the older versioned files as higher priority than the incoming non-versioned files
- MSI removed old files during upgrade but skipped installing the new ones
This left the installation incomplete and non-functional.
Performance Improvements
Beyond fixing the crash, Microsoft significantly optimized the MSI upgrade process. Previously, Windows Installer performed per-file version comparisons—particularly expensive for Python runtime files—making upgrades slow and sometimes inconsistent.
The new approach skips the comparison and performs an overwrite installation, resulting in:
| Scenario | Before | After | Improvement |
|---|---|---|---|
| Fresh Install | Baseline | ~5% faster | 5% faster |
| Upgrade | Long due to file-by-file version comparison | ~23% faster | 23% faster |
Upgrades now use a streamlined clean-install process, making them noticeably faster and more reliable by removing old files first and skipping slow per-file version checks.
Technical Details
For those interested in the technical specifics, Microsoft has published detailed information about the fix in their GitHub repository. The performance optimization was implemented through a packaging change that simplifies file replacement logic during upgrades.
Moving Forward
Microsoft encourages all Azure CLI users to upgrade to the latest version. This not only resolves the upgrade crash issue but also delivers the performance improvements. Users encountering any problems are encouraged to report them on the Azure CLI GitHub repository.
The fix demonstrates Microsoft's commitment to addressing both functional and performance issues in their tooling, ensuring a smoother experience for Azure CLI users across Windows environments.

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