Hello @Maloy Ghosh
A Windows Server 2016 RDS Per User CAL cannot be used to license a Windows Server 2025 RD Session Host.
Microsoft’s RDS CAL compatibility rules allow newer RDS CALs to license older Windows Server versions, but not the reverse. Therefore:
Windows Server 2025 Session Host → Windows Server 2025 RDS CAL required
Windows Server 2016, 2019, and 2022 RDS CALs aren't valid for a Windows Server 2025 Session Host.
Since you have already installed/activated the wrong 10-user Windows Server 2016 RDS CAL pack, I wouldn't recommend trying to modify the licensing database manually or using registry changes to convert it to 2025. An installed 2016 CAL pack cannot simply be changed into a 2025 CAL pack through RD Licensing Manager.
You will need to obtain the correct Windows Server 2025 RDS Per User CALs and install those on a compatible RD License Server.
Also make sure your RD License Server is running Windows Server 2025. Microsoft’s compatibility matrix shows:
So a Windows Server 2022 or older RD License Server cannot host the Windows Server 2025 CAL pack either.
Once you have the correct CALs, use:
Server Manager → Tools → Remote Desktop Services → Remote Desktop Licensing Manager
Activate the Windows Server 2025 license server if necessary, then right-click it and select Install Licenses to install the Windows Server 2025 RDS Per User CAL pack.
Because you've already activated the incorrect 2016 license pack, if your intention was actually to purchase 2025 CALs but the wrong version was supplied/activated, I recommend contacting your Microsoft licensing provider/reseller or the Microsoft Clearinghouse/Activation support team. They can review the license purchase and determine whether the license pack needs to be reissued or corrected.
The Activation ID you've posted publicly isn't necessary for community troubleshooting. I would avoid posting additional licensing IDs, product keys, agreement numbers, or other licensing information here. Provide those only to Microsoft Support/Clearinghouse through a private support channel.
Also, the fact that your Windows Server 2025 VM is hosted in Oracle Cloud Infrastructure (OCI) doesn't change the RDS CAL version compatibility requirement. The Windows Server/RDS licensing of the OCI VM itself should additionally be verified against your Microsoft licensing agreement and Oracle's Windows Server licensing terms.
Hope this helps. If this answers your question, please consider selecting Accept Answer so it can help others with the same issue.