Hello Alex,
You’ve done an excellent job documenting the reproduction and ruling out the usual suspects. Based on the behavior you’re describing, KB5124008 is almost certainly introducing a regression in how Windows 11 clients negotiate the Netlogon secure channel with Server 2019 domain controllers. The key indicators are the ERROR_NO_TRUST_LSA_SECRET (1786) from nltest and the fact that cached credentials still work offline, which points directly to the machine account trust relationship being broken at the LSA secret level.
Microsoft has recently hardened Netlogon secure channel requirements in cumulative updates, enforcing stronger key negotiation and signing. On Server 2019 DCs, if the client update enforces stricter requirements than the DCs advertise, the secure channel handshake fails. This explains why Reset-ComputerMachinePassword doesn’t help: the failure isn’t the password itself, but the negotiation mechanism introduced in KB5124008.
At this point, there is no supported registry-based rollback for Netlogon hardening on the client side. The only reliable mitigation is to uninstall KB5124008 until Microsoft publishes a hotfix or updated guidance. If you must keep the patch for security reasons, the alternative is to raise the DCs to Server 2022 or later, where Netlogon supports the hardened negotiation model introduced in recent Windows 11 builds. That aligns with Microsoft’s documented Netlogon enforcement timeline.
I recommend opening a case with Microsoft Support referencing KB5124008 and the secure channel regression against Server 2019 DCs. This will help escalate the issue and get an official fix or workaround published. Until then, pausing deployment of KB5124008 across your fleet is the correct move.
I hope you've found something useful here. If it helps you get more insight into the issue, it's appreciated to accept the answer. Should you have more questions, feel free to leave a message. Have a nice day!HP.