The keyed version of ArcGIS License Manager does not work and is not supported on virtual machines.
The ArcGIS License Manager needs to be installed on an actual Windows computer, either a workstation or server. However, ArcGIS Desktop or ArcInfo Workstation can be installed on a virtual machine and the license manager that is installed on another computer can be pointed to.
The updated version of the License Manager (keyless 11.6) works and is supported on virtual machines that meet typical operating system requirements.
The updated License Manager can be downloaded from the link under Related Information.