diff --git a/packages/cli/src/test-utils/AppRig.tsx b/packages/cli/src/test-utils/AppRig.tsx
index a9aea95376..8791b75501 100644
--- a/packages/cli/src/test-utils/AppRig.tsx
+++ b/packages/cli/src/test-utils/AppRig.tsx
@@ -170,6 +170,16 @@ export class AppRig {
     );
     this.sessionId = `test-session-${uniqueId}`;
     activeRigs.set(this.sessionId, this);
+
+    // Pre-create the persistent state file to bypass the terminal setup prompt
+    const geminiDir = path.join(this.testDir, '.gemini');
+    if (!fs.existsSync(geminiDir)) {
+      fs.mkdirSync(geminiDir, { recursive: true });
+    }
+    fs.writeFileSync(
+      path.join(geminiDir, 'state.json'),
+      JSON.stringify({ terminalSetupPromptShown: true }),
+    );
   }
 
   async initialize() {
@@ -695,7 +705,7 @@ export class AppRig {
     );
   }
 
-  async waitForIdle(timeout = 20000) {
+  async waitForIdle(timeout = 30000) {
     await this.waitForOutput('Type your message', timeout);
   }
 
diff --git a/packages/cli/src/ui/components/__snapshots__/ConfigInitDisplay.test.tsx.snap b/packages/cli/src/ui/components/__snapshots__/ConfigInitDisplay.test.tsx.snap
index a970ab1a73..8d03baaa49 100644
--- a/packages/cli/src/ui/components/__snapshots__/ConfigInitDisplay.test.tsx.snap
+++ b/packages/cli/src/ui/components/__snapshots__/ConfigInitDisplay.test.tsx.snap
@@ -23,9 +23,3 @@ exports[`ConfigInitDisplay > updates message on McpClientUpdate event 1`] = `
 Spinner Connecting to MCP servers... (1/2) - Waiting for: server2
 "
 `;
-
-exports[`ConfigInitDisplay > updates message on McpClientUpdate event 2`] = `
-"
-Spinner Connecting to MCP servers... (1/2) - Waiting for: server2
-"
-`;