I got stuck with this one too and the big issue I had was trying to get into the grub menu to reset the password. I would either miss it or end up in a grub shell menu where I couldn't do anything. (another support article on this site suggested turning the boot menu on which was not helpful at all).
Finally I followed
this article to get into the grub menu. The short answer is, at least on an M2 Mac where UEFI us used, you have to use ESC to get into the Grub menu (not the left shift key). It specifically called out for me that if you see the grub shell then you've hit ESC too many times.
You need to reset the machine and try again. It took me quite a few tries, but what ended up working for me was hitting ESC right after the Parallels logo disappears.
After that, I then followed tips from
this article on resetting the user Parallels password.
Like others, my MacOS password didn't work and I also wasn't aware you could set a custom password when setting up Ubuntu.
Anyway, hope this helps someone else.
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