I posted a thread last evening asking the same question. There are others reporting the same thing: KB3081424 will get to around 50%, then it will say "unable to install, undoing changes," while restarting 3-4 times. Some have pointed to registry problems, but still not sure what is causing that. I'm waiting a few days to see if Microsoft corrects this, as it is obviously not an isolated problem.
I posted in Microsoft Community before 3 days until Know they didn't answer me!
Lots of people are reporting it, so I'd be very surprised if Microsoft didn't address this soon.
Some articles on our problem:
Windows 10 patch KB 3081424 can crash, fail to install | InfoWorld
Windows 10 Forced Updates Causing Endless Crash Loops - Forbes
Windows 10 Cumulative Update KB3081424 Fails to Install, Stuck in Reboot Loop - Softpedia
Problem still persists as of Sunday evening, still no official fix from Microsoft. ZDNet has also posted an article:
Windows 10 cumulative update causes 'reboot loop' havoc for some users | ZDNetMicrosoft's first cumulative update for Windows 10 - KB3081424 - is causing havoc for some users. How do I know this? Because I spent a good part of my Sunday morning dealing with it, that's how.
The problem, in a nutshell, is that the update puts affected systems into an endless crash loop. The update tries to install, gets to a certain point, fails, and then displays the unhelpful "We couldn't complete the updates, undoing the changes."
I found a fix, but it involved some registry editing voodoo to remove legacy junk (which in my case was related to an Nvidia driver installed on the machine prior to upgrading to Windows 10), a task that some of you might not be comfortable with. Also, since this is not an officially sanctioned fix I'm not comfortable outlining the process here. That said, the fix that worked for me is described in a thread on the Microsoft Answers community if you want to give it a go.
When I remove this registry key I lost log in to my computer,this not work for me.
I haven't even been able to have this update show up in Windows Update, it's not in my update history and doesn't show when I check for updates, is there any chance it was removed because of all the issues?
The thing is, people shouldn't have to tinker with their registry to update their OS. I still see no sign of Microsoft addressing this widespread problem affecting many users.