diff --git a/changelogs/fragments/2010-fix-vm-hardware-version-upgrade-error-not-being-reported.yml b/changelogs/fragments/2010-fix-vm-hardware-version-upgrade-error-not-being-reported.yml
new file mode 100644
index 000000000..44e8c38d1
--- /dev/null
+++ b/changelogs/fragments/2010-fix-vm-hardware-version-upgrade-error-not-being-reported.yml
@@ -0,0 +1,3 @@
+bugfixes:
+  - vmware_guest - Fix errors occuring during hardware version upgrade not being reported.
+    (https://github.com/ansible-collections/community.vmware/pull/2010).
diff --git a/plugins/modules/vmware_guest.py b/plugins/modules/vmware_guest.py
index 1f5a0a818..7482c7caa 100644
--- a/plugins/modules/vmware_guest.py
+++ b/plugins/modules/vmware_guest.py
@@ -3190,7 +3190,9 @@ def reconfigure_vm(self):
         self.relospec.deviceChange = []
         self.configure_guestid(vm_obj=self.current_vm_obj)
         self.configure_cpu_and_memory(vm_obj=self.current_vm_obj)
-        self.configure_hardware_params(vm_obj=self.current_vm_obj)
+        err = self.configure_hardware_params(vm_obj=self.current_vm_obj)
+        if err is not None:
+            return err
         self.configure_encryption_params(vm_obj=self.current_vm_obj)
         self.configure_disks(vm_obj=self.current_vm_obj)
         self.configure_network(vm_obj=self.current_vm_obj)