Azure VM extensions are the small-sized apps used to assist with the process of automation tasks and post-deployment configuration on Azure VMs. You can run Azure VM extensions using PowerShell, Azure CLI, Azure Portal, and Azure Resource Manager templates portal. Azure Virtual Machine extensions can be paired with a new Virtual Machine deployment or you can run them against an existing system.
Reference:
https://docs.microsoft.com/en-us/azure/virtual-machines/extensions/features-windows