Auth token warning using oauth M2M

[septponf]

This was originally posted in dbt-databricks project and I was asked to cross post i here.

Related to: databricks/dbt-databricks#1246

When running dbt in an Azure Devops Agent (for continues integration reasons) I get this warning:

09:13:52  Concurrency: 6 threads (target='test')
09:13:52  
09:13:53  databricks-sql-connector adapter: Token exchange failed, using external token: %s
WARNING:databricks.sql.auth.token_federation:Token exchange failed, using external token: 'access_token'

It still works, the project runs, but I would like to understand what might be happening here.
I am not able to reproduce this on my local machine using the same M2M profile.
Maybe you can point me in the right direction?

Profile using an azure service principal:

    test:
      host: the_host
      http_path: the_path
      catalog: the_catalog
      schema: test
      threads: 6
      type: databricks
      auth_type: oauth
      azure_client_id: "{{ env_var('DATABRICKS_CLIENT_ID') }}"
      azure_client_secret: "{{ env_var('DATABRICKS_CLIENT_SECRET') }}"

Python 3.11.13
Running with dbt=1.10.8
Registered adapter: databricks=1.10.9

The Devops Azure Agent runs an ubuntu-24.04 Image
Version: 20250929.60.1

[msrathore-db]

The logs are regarding token exchange. Currently we try to exchange external Idp tokens for internal Databricks tokens and silently fail if it is not possible