diff --git a/hypervisor/arch/x86/guest/vcpu.c b/hypervisor/arch/x86/guest/vcpu.c
index 277ce0f6a..dcfab9846 100644
--- a/hypervisor/arch/x86/guest/vcpu.c
+++ b/hypervisor/arch/x86/guest/vcpu.c
@@ -667,79 +667,83 @@ int32_t run_vcpu(struct acrn_vcpu *vcpu)
 		write_cached_registers(vcpu);
 	}
 
-	/* If this VCPU is not already launched, launch it */
-	if (!vcpu->launched) {
-		pr_info("VM %d Starting VCPU %hu",
-				vcpu->vm->vm_id, vcpu->vcpu_id);
+	if (is_vcpu_in_l2_guest(vcpu)) {
+		int32_t launch_type;
 
-		/* VMX_VPID for l2 guests is not managed in this way */
-		if (!is_vcpu_in_l2_guest(vcpu) && (vcpu->arch.vpid != 0U)) {
-			exec_vmwrite16(VMX_VPID, vcpu->arch.vpid);
+		if (vcpu->launched) {
+			/* for nested VM-exits that don't need to be reflected to L1 hypervisor */
+			launch_type = VM_RESUME;
+		} else {
+			/* for VMEntry case, VMCS02 was VMCLEARed by ACRN */
+			launch_type = VM_LAUNCH;
+			vcpu->launched = true;
 		}
 
-		/*
-		 * A power-up or a reset invalidates all linear mappings,
-		 * guest-physical mappings, and combined mappings
-		 */
-		if (!is_vcpu_in_l2_guest(vcpu)) {
+		status = exec_vmentry(ctx, launch_type, ibrs_type);
+	} else {
+		/* If this VCPU is not already launched, launch it */
+		if (!vcpu->launched) {
+			pr_info("VM %d Starting VCPU %hu",
+					vcpu->vm->vm_id, vcpu->vcpu_id);
+
+			if (vcpu->arch.vpid != 0U) {
+				exec_vmwrite16(VMX_VPID, vcpu->arch.vpid);
+			}
+
+			/*
+			 * A power-up or a reset invalidates all linear mappings,
+			 * guest-physical mappings, and combined mappings
+			 */
 			flush_vpid_global();
-		}
 
 #ifdef CONFIG_HYPERV_ENABLED
-		if (is_vcpu_bsp(vcpu)) {
-			hyperv_init_time(vcpu->vm);
-		}
+			if (is_vcpu_bsp(vcpu)) {
+				hyperv_init_time(vcpu->vm);
+			}
 #endif
 
-		/* Set vcpu launched */
-		vcpu->launched = true;
+			/* Set vcpu launched */
+			vcpu->launched = true;
 
-		/* avoid VMCS recycling RSB usage, set IBPB.
-		 * NOTE: this should be done for any time vmcs got switch
-		 * currently, there is no other place to do vmcs switch
-		 * Please add IBPB set for future vmcs switch case(like trusty)
-		 */
-		if (ibrs_type == IBRS_RAW) {
-			msr_write(MSR_IA32_PRED_CMD, PRED_SET_IBPB);
-		}
-
-		/* Launch the VM */
-		status = exec_vmentry(ctx, VM_LAUNCH, ibrs_type);
-
-		/* See if VM launched successfully */
-		if (status == 0) {
-			if (is_vcpu_bsp(vcpu)) {
-				pr_info("VM %d VCPU %hu successfully launched",
-					vcpu->vm->vm_id, vcpu->vcpu_id);
+			/* avoid VMCS recycling RSB usage, set IBPB.
+			 * NOTE: this should be done for any time vmcs got switch
+			 * currently, there is no other place to do vmcs switch
+			 * Please add IBPB set for future vmcs switch case(like trusty)
+			 */
+			if (ibrs_type == IBRS_RAW) {
+				msr_write(MSR_IA32_PRED_CMD, PRED_SET_IBPB);
 			}
-		}
-	} else {
-		/* This VCPU was already launched, check if the last guest
-		 * instruction needs to be repeated and resume VCPU accordingly
-		 */
-		if (vcpu->arch.inst_len != 0U) {
-			exec_vmwrite(VMX_GUEST_RIP, vcpu_get_rip(vcpu) + vcpu->arch.inst_len);
+
+			/* Launch the VM */
+			status = exec_vmentry(ctx, VM_LAUNCH, ibrs_type);
+
+			/* See if VM launched successfully */
+			if (status == 0) {
+				if (is_vcpu_bsp(vcpu)) {
+					pr_info("VM %d VCPU %hu successfully launched",
+						vcpu->vm->vm_id, vcpu->vcpu_id);
+				}
+			}
+		} else {
+			/* This VCPU was already launched, check if the last guest
+			 * instruction needs to be repeated and resume VCPU accordingly
+			 */
+			if (vcpu->arch.inst_len != 0U) {
+				exec_vmwrite(VMX_GUEST_RIP, vcpu_get_rip(vcpu) + vcpu->arch.inst_len);
+			}
+
+			/* Resume the VM */
+			status = exec_vmentry(ctx, VM_RESUME, ibrs_type);
 		}
 
-		/* Resume the VM */
-		status = exec_vmentry(ctx, VM_RESUME, ibrs_type);
-	}
-
-	vcpu->reg_cached = 0UL;
-
-	/*
-	 * - can not call vcpu_get_xxx() when vmcs02 is current, or it could mess up
-	 *   the cached registers for the L1 guest
-	 * - the L2 guests' vcpu mode is managed by L1 hypervisor
-	 * - ctx->cpu_regs.regs.rsp doesn't cache nested guests' RSP
-	 */
-	if (!is_vcpu_in_l2_guest(vcpu)) {
 		cs_attr = exec_vmread32(VMX_GUEST_CS_ATTR);
 		ia32_efer = vcpu_get_efer(vcpu);
 		cr0 = vcpu_get_cr0(vcpu);
 		set_vcpu_mode(vcpu, cs_attr, ia32_efer, cr0);
 	}
 
+	vcpu->reg_cached = 0UL;
+
 	/* Obtain current VCPU instruction length */
 	vcpu->arch.inst_len = exec_vmread32(VMX_EXIT_INSTR_LEN);