At least three issues are affecting Windows 11, two of which MS has acknowledged so far. The first causes the cursor to disappear, appear broken, or lose its custom settings. The second causes Office apps to crash on ARM-based PCs, although this is not a major problem. The third resets wallpapers after every restart, but MS has not yet confirmed it.

On August 27, 2026, MS released Windows 11 KB5120998, updating PCs to Builds 26200.9168 (25H2) and 26100.9168 (24H2). This was one of the year’s most important releases because it introduced three of the most requested Windows 11 features: a movable taskbar, a resizable Start menu, and the ability to remove Bing from Search.

At the same time, however, we found that the update resets the desktop background and disrupts the mouse cursor. The cursor may look unusual, disappear, lag, or feel out of place because of faulty animations.

Users have also reported that the cursor resets to its default settings or applies personalization incorrectly. For example, a white cursor may turn black and appear larger than normal. Another reported bug causes fonts to appear blurry.

MS Confirms the Windows 11 Update Broke the Mouse Cursor

In an updated document spotted today by Windows Latest, MS confirmed that the Windows 11 update released on August 27, 2026, KB5120998, broke the cursor.

MS previously said it was aware of the reports but was unsure whether the update had caused the issue. However, another support document confirms that MS made a change that broke mouse personalization settings:

“Our investigation indicates that this issue is caused by code components used in non-English Windows installations,” MS noted. “In impacted locales, these settings will fail to load, causing a default to be used instead. Attempting to manually restore the settings values is not successful, as the issue prevents loading these settings regardless of their value.”

MS’s findings align with reports reviewed by Windows Latest. They also explain why users cannot simply reset the cursor to its original configuration: the settings are not saved.

“The cursor is just stuck on the old one for default and busy. No other options change it in any way, including inverse cursor. Reboot, graphic driver re-install, removing mouse device doesn’t help,” one user wrote in a post on Feedback Hub.

“Same for me. Also, the cursor sizes are wrong—bigger than they should be,” another user added.

However, reports reviewed by Windows Latest suggest that the issue does not exclusively affect people using Windows in a non-English language. Users who have installed a secondary language or added a keyboard layout may also be affected.

Because of MS’s gradual rollout process, the bug has not yet reached every PC. It may therefore appear in the coming days for users who install Windows 11 KB5120998.

Dozens of people have also emailed us or posted comments describing their frustrating experiences with the cursor or desktop background after installing Windows 11 KB5120998.

“I wish I had read this article sooner,” one reader told Windows Latest. “My wallpaper is gone, and I have a black screen, which, of course, I replaced successfully, but the cursor style is completely broken. I tried everything—from changing its style, size, colors, etc.—but it just loads for a few seconds after restarting the PC and then goes back to the classic old cursor styling.”

MS Also Confirms Office Apps Can Crash on ARM PCs

MS has also confirmed that Office apps may crash on some ARM-based PCs after recent Windows updates. Although this is not as significant as the cursor issue, it is another confirmed regression.

“After installing Windows security updates released on or after August 11, 2026 (KB5121003), MS Teams and the new Outlook for Windows might fail to launch or might close unexpectedly on ARM-based devices,” MS noted. The company confirmed that a fix will be included in the next update, likely the September 2026 Patch Tuesday release.

The Wallpaper Issue Remains Unconfirmed

MS has not yet confirmed the wallpaper issue.

Windows Latest has reviewed reports that the desktop background resets after every restart. In some cases, the wallpaper disappears entirely, leaving users with a black background until they manually set it again.

The broken mouse cursor and wallpaper issues have been among the most frequently reported problems in recent months. For that reason, I believe Windows 11 KB5120998 is the buggiest release since MS promised to revive the operating system.

In recent months, I have observed that monthly updates have become considerably more stable, with the number of reported issues declining by as much as 70% compared with last year. However, the August 2026 update is an unusual release with too many problems.

Nevertheless, I have not encountered any BSODs or other severe issues with the Windows 11 August update. At worst, users may experience a broken cursor and a missing background, both of which can be resolved by uninstalling the update.

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