Microsoft acknowledges Windows Hello issue in Windows 11 after installing KB5055523. It fails to recognize the user, despite the hardware is working properly. This patch is a stable cumulative update released this month.

Microsoft is aware of the issue and is working on a solution. The company noted the following.
"We're aware of an edge case of Windows Hello issue affecting devices with specific security features enabled. After installing this update and performing a Push button reset or Reset this PC from Settings > System > Recovery and selecting Keep my Files and Local install, some users might be unable to login to their Windows services using Windows Hello facial recognition or PIN. Users might observe a Windows Hello Message saying "Something happened and your PIN isn't available. Click to set up your PIN again" or "Sorry something went wrong with face setup."
The issue mostly affects devices with an IR sensor that works in pair with camera for face recognition. After installing the patch, if the camera is disabled, the IR sensor also becomes disabled. So Windows Hello cannot work.
As a workaround, you can use a PIN to unlock your device. Of course, this will only work if you have set the PIN earlier.
The frustration doesn’t stop there. The update also created an "inetpub" folder in the root of the system drive without explanation, leaving many confused until Microsoft later clarified it was an intentional change.
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