Azure creates a separate new database while restoring one. The new database may be renamed to the old one to make it The restored databases are automatically stored at a Geo replicated Blob Storage.
Database replacement is used to periodically restore a Database and also maintain the backup history.
If the original database is intended to be restored exactly how it is, you can specify the service tier and compute the size of the original database. ALTER DATABASE command may be used to rename the restored database to the original database.
To get a better understanding, you can check this Azure Administrator certification out.