Single-Root I/O Virtualization
In a virtual environment in general virtual machines network traffic carried on software based NIC and switches, as you expect software can never be as efficient as hardware.
Software based connectivity is works fine for many applications, but in some specific application need to leverage hardware features to scale up hosts more, to accelerate performance, to reduce latency,
Windows Server 2012 Hyper-V comes with SR-IOV.
SR-IOV is a hardware solution based on PCI-SIG I/O Virtualization (IOV) specifications that is designed to replace the role of software in virtual machine connectivity.
Figure below shows the normal flow of virtual machine network traffic to/from the physical network.
You may noticed the long path of the traffic that causes a slight latency, but as I mentioned before this works fine for many applications.
Figure below shows the logical view of SR-IOV-enabled networking
SR-IOV is a hardware feature that reduces the role of software in the networking link between virtual machines and the physical network. It will reduce the network latency for virtualized workloads, increase the throughput and levels of security
Keep in mind that that we are relying on a new hardware feature called a Virtual Function (VF).
Make sure your hardware support SR-IOV before you enable on vNIC.
When a virtual NIC is enabled for Hyper-V, it no longer connects to the virtual switch. It instead connects directly to a VF on the SR-IOV-enabled physical NIC.
Figure below shows how to enable Single-root I/O Virtualization on VM setting