Fault Domain
In Azure a Fault Domain means a rack of servers. It consumes network, power and cooling; 2 VMs in the same availability set means Azure will provision them in to 2 different racks.
There are always 2 or 3 fault domains: FD0, FD1 and FD2
Source:
https://docs.microsoft.com/en-us/azure/virtual-machines/windows/manage-availability