We've had several people test this on dozens of iOS 11 devices and consistently get the same results - sandbox testing for auto-renewing IAP subscriptions does not work correctly in iOS 11.
These are the official directions from Apple. Here I have modified them for TestFlight:
1. Create a sandbox user from iTunes Connect
2. Launch TestFlight and download the app that needs testing
3. Go into Settings and log out of the App Store
4. Launch the app and try to make an in-app purchase
5. When prompted, log in with the sandbox account from step 1
6. When finished testing, go into Settings and log out of the App Store. Then log back in to your primary Apple ID
Step 5 does not work. When the user reaches step 5, there are two possible outcomes:
A. iOS simply asks them to enter the password for their primary Apple ID, not giving them the option to log in using a sandbox account
B. iOS asks them to log in to the App Store and gives them the opportunity to enter the credentials for the sandbox account. However, after they do this, another dialog pops up asking them to enter the password for their primary Apple ID.
In either case, sandbox subscription purchases are applied to the user's regular Apple ID, not a sandbox tester ID. Because of this, we are unable to do any sandbox testing.