That's the expected bahaviour.
From https://kb.vmware.com/s/article/55806
Enabling this option will result in the vSphere UI reporting only a single logical processor per physical core; halving the number of logical processors if Hyperthreading was previously enabled. In addition Hyperthreading may be reported as 'Disabled' in various configuration tabs.
In case you just wanted to suppress the message, but leave things as is, follow https://kb.vmware.com/s/article/57374
André
