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Yup, that's the best use-case. The more that cloudy / container stuff takes over the less I use Ansible tbf.

A lot of post provisioning tasks I used to do with Ansible are now handled with cloud-init.

Exactly. We use it in the pipeline for building the AMI unfortunately at my current place but it's not optimal.

I like Packer + Ansible for building machine images. I haven't really tried any alternative workflows but that has been great for my needs so far!