Once you have enabled stateless caching on the associated host profile and configured the host to always do a network boot first then, during the next reboot of the ESXi machine, it performs a network boot and loads the ESXi image from the Auto Deploy server. The server finishes booting and applies (remediates) the host profile. Remediation will dump the ESXi image running in memory to the first disk (the local disk, by default) that's selected during the stateless configuration.

After this, if an attempt to network boot the ESXi host fails, it will load the image that was cached to the local disk during the previous successful network boot.