UI perpetually displays "Loading environment" despite environment being fully loaded

[jebalert]

Describe the bug

After updating to the most recent version of the GitHub Copilot CLI (v1.0.15), the "Loading environment" spinner in the UI never resolves — it continues showing indefinitely. However, the CLI is fully functional: MCP servers connect, skills load and work correctly, and all commands execute as expected. The issue is purely a UI/status display bug where the loading indicator never transitions to a "ready" state.

Restarting the CLI does not resolve the issue.

Affected version

GitHub Copilot CLI 1.0.15

Steps to reproduce the behavior

1. Update Copilot CLI to v1.0.15 (e.g., copilot update)
2. Launch copilot in the terminal
3. Observe the "Loading environment" spinner in the UI
4. Note that MCP tools and skills function correctly despite the spinner
5. The "Loading environment" indicator never clears, even after the environment is fully loaded
6. Restarting the CLI does not fix the issue

Expected behavior

The "Loading environment" spinner should disappear once the environment (MCP servers, skills, etc.) has finished loading and is ready for use.

Additional context

• Operating system: Windows 10 Enterprise (NT 10.0.26200.0)
• CPU architecture: ARM64
• Terminal: Windows Terminal
• Shell: PowerShell 7.6.0
• The issue began immediately after updating to the latest CLI version. Prior versions did not exhibit this behavior.
• All functionality works correctly — this is a UI-only bug with the loading status indicator.

[ilsubyeega]

#2459

[jebalert]

Can confirm v1.0.16-1 has resolved the bug.

[stephentoub]

Can confirm v1.0.16-1 has resolved the bug.

Closing. Thanks.