The Azure reservation discount is applied to running VM instances on an hourly basis. The reservations that you have purchased are matched to the usage emitted by the running VMs to apply the reservation discount. For VMs that may not run the full hour, the reservation will be filled from other VMs not using a reservation, including concurrently running VMs. At the end of the hour, the reservation application for VMs in the hour is locked. In the event a VM does not run for an hour or concurrent VMs within the hour do not fill the hour of the reservation, the reservation is underutilized for that hour. The following graph illustrates the application of a reservation to billable VM usage. The illustration is based on one reservation purchase and two matching VM instances.
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