"Copilot instruction not found" message

[NichtHeino]

Describe the bug

(on startup:) "No copilot instructions found. Run /init to generate a copilot-instructions.md file for this project." But /env says "Environment loaded: 1 custom instruction".
It seems also that a present AGENTS.md file is not recognized as instruction.

Affected version

v1.0.39

Steps to reproduce the behavior

start from scratch, message appears immediately after the banner

Expected behavior

Copilot recognizes all instruction files as rendered by help on startup:
CLAUDE.md
GEMINI.md
AGENTS.md (in git root & cwd)
.github/instructions/**/*.instructions.md (in git root & cwd)
.github/copilot-instructions.md
$HOME/.copilot/copilot-instructions.md
and shows these with /env.

Additional context

No response