diff --git a/e2e/vmss.go b/e2e/vmss.go
index 3b1b9202d45..9ec402850b8 100644
--- a/e2e/vmss.go
+++ b/e2e/vmss.go
@@ -510,19 +510,31 @@ func skipTestIfSKUNotAvailableErr(t testing.TB, err error) {
 		return
 	}
 	var respErr *azcore.ResponseError
-	if !errors.As(err, &respErr) || respErr.StatusCode != 409 {
+	if !errors.As(err, &respErr) {
 		return
 	}
-	// sometimes the SKU is not available and we can't do anything. Skip the test in this case.
+	// SKU not available in region (409)
 	if respErr.ErrorCode == "SkuNotAvailable" {
 		t.Skip("skipping scenario SKU not available", t.Name(), err)
 	}
-	// sometimes the SKU quota is exceeded and we can't do anything. Skip the test in this case.
+	// Quota exceeded (409)
 	if respErr.ErrorCode == "OperationNotAllowed" &&
 		strings.Contains(respErr.Error(), "exceeding approved") &&
 		strings.Contains(respErr.Error(), "quota") {
 		t.Skip("skipping scenario SKU quota exceeded", t.Name(), err)
 	}
+	// Allocation failures for GPU/exotic SKUs with limited availability.
+	// AllocationFailed returns HTTP 200 (not 409), so it won't be caught by status code checks.
+	// These can persist even after CreateVMSSWithRetry exhausts its retries.
+	if respErr.ErrorCode == "AllocationFailed" {
+		t.Skip("skipping scenario allocation failed", t.Name(), err)
+	}
+	// Zonal allocation constraints — no capacity in the requested zone (409)
+	if respErr.ErrorCode == "OverconstrainedZonalAllocationRequest" ||
+		respErr.ErrorCode == "OverconstrainedAllocationRequest" ||
+		respErr.ErrorCode == "ZonalAllocationFailed" {
+		t.Skip("skipping scenario zonal allocation constrained", t.Name(), err)
+	}
 }
 
 func cleanupVMSS(ctx context.Context, s *Scenario, vm *ScenarioVM) {