diff --git a/features/automation_profile_cli.feature b/features/automation_profile_cli.feature
index ed081c27c..33f970903 100644
--- a/features/automation_profile_cli.feature
+++ b/features/automation_profile_cli.feature
@@ -20,6 +20,13 @@ Feature: Automation Profile CLI commands
     Then the automation-profile add should succeed
     And the automation-profile output should contain "Updated"
 
+  Scenario: Add profile with --update when profile does not exist warns and creates
+    Given a valid automation profile config YAML file
+    When I run automation-profile add with --config and --update
+    Then the automation-profile add should succeed
+    And the automation-profile output should contain "Warning"
+    And the automation-profile output should contain "Profile Added"
+
   Scenario: Add profile conflict without --update
     Given a valid automation profile config YAML file
     And the custom profile "acme/strict" already exists
diff --git a/src/cleveragents/cli/commands/automation_profile.py b/src/cleveragents/cli/commands/automation_profile.py
index da6803375..1c5baab8e 100644
--- a/src/cleveragents/cli/commands/automation_profile.py
+++ b/src/cleveragents/cli/commands/automation_profile.py
@@ -236,6 +236,12 @@ def add_profile(
                 )
             raise typer.Abort()
 
+        if update and not existing:
+            console.print(
+                f"[yellow]Warning:[/yellow] Profile '{name}' does not exist. "
+                f"Creating new profile (--update flag has no effect)."
+            )
+
         if update and existing:
             profile = service.update_profile(name, config_data)
             title = "Profile Updated"