diff --git a/pkg/cloudprovider/providers/azure/azure_instances.go b/pkg/cloudprovider/providers/azure/azure_instances.go
index 158ffb976ca..daac2806a5e 100644
--- a/pkg/cloudprovider/providers/azure/azure_instances.go
+++ b/pkg/cloudprovider/providers/azure/azure_instances.go
@@ -23,9 +23,8 @@ import (
 	"strings"
 
 	"k8s.io/api/core/v1"
-	cloudprovider "k8s.io/cloud-provider"
-
 	"k8s.io/apimachinery/pkg/types"
+	cloudprovider "k8s.io/cloud-provider"
 	"k8s.io/klog"
 )
 
@@ -155,6 +154,9 @@ func (az *Cloud) InstanceExistsByProviderID(ctx context.Context, providerID stri
 
 	name, err := az.vmSet.GetNodeNameByProviderID(providerID)
 	if err != nil {
+		if err == cloudprovider.InstanceNotFound {
+			return false, nil
+		}
 		return false, err
 	}