vMotion Precheck Fails with Error: "vMotion is not licensed for the source/destination host" despite valid ESXi licensing

Products

• VMware vCenter Server
• VMware vSphere ESXi

Issue/Introduction

When attempting to initiate a vMotion task, the following precheck error is observed:

vMotion is not licensed for the source host '######'

Additional symptoms include:

• The affected ESXi host is correctly licensed with a vSphere Enterprise or valid license.
• The license assignment option appears greyed out for the host in the vSphere UI.
• vCenter logs show SOAP-related errors while communicating with the license service.

Log Snippets (vCenter - /var/log/vmware/vpxd/vpxd.log):

SOAP request returned HTTP failure; code: 500(Internal Server Error); fault: (vim.fault.LicenseEntityNotFound) ... text = "/usr/sbin/esxupdate returned with exit status: 7"

Environment

• VMware vSphere 7.0.x
• VMware vSphere 8.0.x

Cause

This issue occurs when vCenter Server fails to retrieve or update license information from the affected ESXi host. This can be caused by:

• A stale connection state between vCenter Server and the host.
• Temporary communication issues preventing the license service from synchronizing license data.
• The license metadata on the host may not refresh automatically without a reconnect.

Resolution

To resolve the issue, follow the steps below:

1. Disconnect and Reconnect the Affected ESXi Host:
   1. From the vSphere Client, right-click the affected ESXi host.
   2. Select Disconnect. Wait for the operation to be completed.
   3. Then, right-click the same ESXi host and choose Connect.
      
      
2. Verify License Sync:
   1. After reconnection, navigate to the host Configure > Licensing.
   2. Ensure the license information is now visible and no longer greyed out.
   3. Reattempt the vMotion operation.
      
      
3. Check Logs:
   1. For confirmation, review the /var/log/vmware/vpxd/vpxd.log in the vCenter Server to see the following successful license push:
      Push license key: ''#####-#####-#####-#####-#####" to host: host-######