diff --git a/api/v1alpha2/azuremachine_conversion.go b/api/v1alpha2/azuremachine_conversion.go
index 8e1feadb5ac..313007a09fb 100644
--- a/api/v1alpha2/azuremachine_conversion.go
+++ b/api/v1alpha2/azuremachine_conversion.go
@@ -36,10 +36,17 @@ func (src *AzureMachine) ConvertTo(dstRaw conversion.Hub) error { // nolint
 	if ok, err := utilconversion.UnmarshalData(src, restored); err != nil || !ok {
 		return err
 	}
+	restoreAzureMachineSpec(&restored.Spec, &dst.Spec)
 
 	return nil
 }
 
+func restoreAzureMachineSpec(restored, dst *infrav1alpha3.AzureMachineSpec) {
+	if restored.SpotVMOptions != nil {
+		dst.SpotVMOptions = restored.SpotVMOptions.DeepCopy()
+	}
+}
+
 // ConvertFrom converts from the Hub version (v1alpha3) to this version.
 func (dst *AzureMachine) ConvertFrom(srcRaw conversion.Hub) error { // nolint
 	src := srcRaw.(*infrav1alpha3.AzureMachine)
diff --git a/api/v1alpha2/azuremachinetemplate_conversion.go b/api/v1alpha2/azuremachinetemplate_conversion.go
index d1a5da3d3ba..db7915d95e8 100644
--- a/api/v1alpha2/azuremachinetemplate_conversion.go
+++ b/api/v1alpha2/azuremachinetemplate_conversion.go
@@ -34,6 +34,7 @@ func (src *AzureMachineTemplate) ConvertTo(dstRaw conversion.Hub) error { // nol
 	if ok, err := utilconversion.UnmarshalData(src, restored); err != nil || !ok {
 		return err
 	}
+	restoreAzureMachineSpec(&restored.Spec.Template.Spec, &dst.Spec.Template.Spec)
 
 	return nil
 }