diff --git a/pkg/cloudprovider/provider/azure/provider.go b/pkg/cloudprovider/provider/azure/provider.go
index 143be9a8f..d604e5c4a 100644
--- a/pkg/cloudprovider/provider/azure/provider.go
+++ b/pkg/cloudprovider/provider/azure/provider.go
@@ -160,7 +160,7 @@ var imageReferences = map[providerconfig.OperatingSystem]compute.ImageReference{
 		// flatcar-container-linux-corevm-amd64 doesn't require a plan. For more info: https://www.flatcar.org/docs/latest/installing/cloud/azure/#corevm
 		Offer:   to.StringPtr("flatcar-container-linux-corevm-amd64"),
 		Sku:     to.StringPtr("stable"),
-		Version: to.StringPtr("4230.2.2"),
+		Version: to.StringPtr("4459.2.3"),
 	},
 	providerconfig.OperatingSystemRockyLinux: {
 		Publisher: to.StringPtr("resf"),
diff --git a/test/e2e/provisioning/all_e2e_test.go b/test/e2e/provisioning/all_e2e_test.go
index ad94fa78b..13945cd49 100644
--- a/test/e2e/provisioning/all_e2e_test.go
+++ b/test/e2e/provisioning/all_e2e_test.go
@@ -573,7 +573,7 @@ func TestAzureProvisioningE2E(t *testing.T) {
 	}
 
 	// In-tree cloud provider is not supported from Kubernetes v1.30.
-	selector := Not(OsSelector("amzn2"))
+	selector := Not(OsSelector("amzn2", "rhel"))
 
 	// act
 	params := []string{
diff --git a/test/e2e/provisioning/testdata/machinedeployment-azure-custom-image-reference.yaml b/test/e2e/provisioning/testdata/machinedeployment-azure-custom-image-reference.yaml
index 18eb88c32..f30449bb8 100644
--- a/test/e2e/provisioning/testdata/machinedeployment-azure-custom-image-reference.yaml
+++ b/test/e2e/provisioning/testdata/machinedeployment-azure-custom-image-reference.yaml
@@ -33,7 +33,7 @@ spec:
             location: "westeurope"
             resourceGroup: "machine-controller-e2e"
             vnetResourceGroup: ""
-            vmSize: "Standard_F2"
+            vmSize: "Standard_F2s_v2"
             # optional disk size values in GB. If not set, the defaults for the vmSize will be used.
             osDiskSize: << OS_DISK_SIZE >>
             dataDiskSize: << DATA_DISK_SIZE >>
@@ -42,8 +42,8 @@ spec:
             routeTableName: "machine-controller-e2e"
             imageReference:
               publisher: "Canonical"
-              offer: "0001-com-ubuntu-server-focal"
-              sku: "20_04-lts"
+              offer: "ubuntu-24_04-lts"
+              sku: "server"
               version: "latest"
             assignPublicIP: false
             zones: