diff --git a/src/vs/workbench/api/node/extHostTerminalService.ts b/src/vs/workbench/api/node/extHostTerminalService.ts
index 930b010a09c..6bade2ed5d6 100644
--- a/src/vs/workbench/api/node/extHostTerminalService.ts
+++ b/src/vs/workbench/api/node/extHostTerminalService.ts
@@ -24,6 +24,7 @@ import type * as vscode from 'vscode';
 export class ExtHostTerminalService extends BaseExtHostTerminalService {
 
 	private _variableResolver: ExtHostVariableResolverService | undefined;
+	private _variableResolverPromise: Promise<ExtHostVariableResolverService>;
 	private _lastActiveWorkspace: IWorkspaceFolder | undefined;
 
 	// TODO: Pull this from main side
@@ -45,7 +46,7 @@ export class ExtHostTerminalService extends BaseExtHostTerminalService {
 		getSystemShell(platform.platform, process.env as platform.IProcessEnvironment).then(s => this._defaultShell = s);
 
 		this._updateLastActiveWorkspace();
-		this._updateVariableResolver();
+		this._variableResolverPromise = this._updateVariableResolver();
 		this._registerListeners();
 	}
 
@@ -116,7 +117,9 @@ export class ExtHostTerminalService extends BaseExtHostTerminalService {
 
 	private _registerListeners(): void {
 		this._extHostDocumentsAndEditors.onDidChangeActiveTextEditor(() => this._updateLastActiveWorkspace());
-		this._extHostWorkspace.onDidChangeWorkspace(() => this._updateVariableResolver());
+		this._extHostWorkspace.onDidChangeWorkspace(() => {
+			this._variableResolverPromise = this._updateVariableResolver();
+		});
 	}
 
 	private _updateLastActiveWorkspace(): void {
@@ -126,15 +129,16 @@ export class ExtHostTerminalService extends BaseExtHostTerminalService {
 		}
 	}
 
-	private async _updateVariableResolver(): Promise<void> {
+	private async _updateVariableResolver(): Promise<ExtHostVariableResolverService> {
 		const configProvider = await this._extHostConfiguration.getConfigProvider();
 		const workspaceFolders = await this._extHostWorkspace.getWorkspaceFolders2();
 		this._variableResolver = new ExtHostVariableResolverService(workspaceFolders || [], this._extHostDocumentsAndEditors, configProvider);
+		return this._variableResolver;
 	}
 
 	public async $getAvailableProfiles(quickLaunchOnly: boolean): Promise<ITerminalProfile[]> {
 		const config = await (await this._extHostConfiguration.getConfigProvider()).getConfiguration().get('terminal.integrated');
-		return detectAvailableProfiles(quickLaunchOnly, this._logService, config as ITerminalConfiguration, this._variableResolver, this._lastActiveWorkspace);
+		return detectAvailableProfiles(quickLaunchOnly, this._logService, config as ITerminalConfiguration, await this._variableResolverPromise, this._lastActiveWorkspace);
 	}
 
 	public async $getDefaultShellAndArgs(useAutomationShell: boolean): Promise<IShellAndArgsDto> {
diff --git a/src/vs/workbench/contrib/terminal/node/terminalProfiles.ts b/src/vs/workbench/contrib/terminal/node/terminalProfiles.ts
index c47fb560265..07c47fcc800 100644
--- a/src/vs/workbench/contrib/terminal/node/terminalProfiles.ts
+++ b/src/vs/workbench/contrib/terminal/node/terminalProfiles.ts
@@ -72,19 +72,23 @@ async function transformToTerminalProfiles(entries: IterableIterator<[string, IT
 	const resultProfiles: ITerminalProfile[] = [];
 	for (const [profileName, profile] of entries) {
 		if (profile === null) { continue; }
-		let paths: string[];
+		let originalPaths: string[];
 		let args: string[] | string | undefined;
+
 		if ('source' in profile) {
 			const source = profileSources?.get(profile.source);
 			if (!source) {
 				continue;
 			}
-			paths = source.paths.slice();
+			originalPaths = source.paths;
 			args = source.args;
 		} else {
-			paths = Array.isArray(profile.path) ? profile.path : [profile.path];
+			originalPaths = Array.isArray(profile.path) ? profile.path : [profile.path];
 			args = profile.args;
 		}
+
+		const paths = originalPaths.slice();
+
 		for (let i = 0; i < paths.length; i++) {
 			paths[i] = variableResolver?.resolve(workspaceFolder, paths[i]) || paths[i];
 		}
@@ -92,7 +96,7 @@ async function transformToTerminalProfiles(entries: IterableIterator<[string, IT
 		if (validatedProfile) {
 			resultProfiles.push(validatedProfile);
 		} else {
-			logService?.trace('profile not validated', profileName, paths);
+			logService?.trace('profile not validated', profileName, originalPaths);
 		}
 	}
 	return resultProfiles;
@@ -249,7 +253,6 @@ async function validateProfilePaths(label: string, potentialPaths: string[], sta
 			}
 		}
 	} catch (e) {
-		logService?.info('error', e);
 		// Also try using lstat as some symbolic links on Windows
 		// throw 'permission denied' using 'stat' but don't throw
 		// using 'lstat'