diff --git a/cli/src/tunnels/control_server.rs b/cli/src/tunnels/control_server.rs
index f42984cfac1..dfb5e381179 100644
--- a/cli/src/tunnels/control_server.rs
+++ b/cli/src/tunnels/control_server.rs
@@ -920,9 +920,14 @@ async fn handle_update(
 
 	info!(log, "Updating CLI to {}", latest_release);
 
-	updater
+	let r = updater
 		.do_update(&latest_release, SilentCopyProgress())
-		.await?;
+		.await;
+
+	if let Err(e) = r {
+		did_update.store(false, Ordering::SeqCst);
+		return Err(e);
+	}
 
 	Ok(UpdateResult {
 		up_to_date: true,