We are trying to confirm the experience we are seeing is to be expected.
We are using ADFS to authenticate our users and provide a SSO experience which works fine.
As soon as we enable the ability to provide external sharing to SPO, our users get directed to the AAD account login screen where the user needs to select their username and then allowed to enter O365.
Turn off external sharing and the user experience goes back too SSO.
We took this up with Premiere and they indicated that this is expected because of our use of ADFS for SSO.
Was just wondering if this is in fact the experience we should be seeing?
This is the experience that you will get as I have seen this before. The issue is that external users need to authenticate through AAD as that holds there account reference, if it directed them to ADFS they wouldn't be able to sign in as there account is not in your internal AD. There isn't a workaround for this that I know of.