Update: This issue has been fixed by Apple in iOS 12 Beta 6. Please update your iOS devices to iOS 12 when it is released. We will monitor future betas to ensure that the fix continues to work. Note that Apple has not yet announced a date for when iOS 12 will be released.
This issue is seen in devices with iOS 11.3.1 and 11.4 where users have enabled “Use Touch ID for iTunes and App Store” in Settings (see screenshot) and you want to deploy iOS store apps with assignment types 'Required', 'Available for enrolled devices' or 'Available with or without enrollment'.
When installation is attempted for Intune-managed store apps deployed as above, a Face ID/Touch ID authentication prompt appears, attempts authentication a few times, and eventually fails with the message “The <app name> could not be installed”.
We have determined that the root cause for this issue is an iOS bug. Apple is aware of the issue and we will keep this page updated as we know more.
Until this is fixed, if you wish to deploy apps on iOS 11.3.1 or 11.4 with the assignment types listed above, please ask end users on those devices to temporarily disable the setting 'Use Touch ID for iTunes and App Store'.
8/7/18: Updated with Apple bug fix information
7/30/18: Updated to clarify assignment types