The error of "Serving" will not be cleared even if the clusterextension is upgrade successfully. 

1, create a ClusterExtension
2, upgrade the ClusterExtension to a non-exist version, bellow error raised
'error upgrading from currently installed version "0.1.0": no bundles       found for package "nginx77972" matching version "0.2.0"'
3, upgrade the  ClusterExtension to a right version, above error won't be cleared.    

4.19.0-0.nightly-2025-03-03-170005    

   always 

    1.create clustercatalog
xzha@xzha1-mac OCP-77972 % cat catalog.yaml
apiVersion: olm.operatorframework.io/v1
kind: ClusterCatalog
metadata:
  name: catalog-77972
  labels:
    example.com/support: "true"
    test-cases: ocp-77972
spec:
  priority: 1000
  source:
    type: Image
    image:
      ref: quay.io/openshifttest/nginxolm-operator-index:nginxolm77972 

    2. create sa/role/rolebindings
    3. create ClusterExtension
xzha@xzha1-mac OCP-77972 % cat extension.yaml
apiVersion: olm.operatorframework.io/v1
kind: ClusterExtension
metadata:
  name: "extension-77972"
spec:
  namespace: "ns-77972"
  serviceAccount:
    name: "test-77972"
  source:
    sourceType: "Catalog"
    catalog:
      packageName: "nginx77972"
      version: "0.1.0"
      upgradeConstraintPolicy: "CatalogProvided"  

cluster is installed successfully

  - lastTransitionTime: "2025-03-04T07:16:27Z"
    message: Installed bundle quay.io/openshifttest/nginxolm-operator-bundle:v0.1.0-nginxolm77972
      successfully
    observedGeneration: 1
    reason: Succeeded
    status: "True"
    type: Installed
  - lastTransitionTime: "2025-03-04T07:16:27Z"
    message: desired state reached
    observedGeneration: 1
    reason: Succeeded
    status: "True"
    type: Progressing
  install:
    bundle:
      name: nginx77972.v0.1.0
      version: 0.1.0   

4, try to upgrade ClusterExtension to a non-exist version
xzha@xzha1-mac OCP-77972 % oc patch ClusterExtension extension-77972 -p '{"spec":{"source":{"catalog":{"version":"0.2.0"}}}}' --type=merge
clusterextension.olm.operatorframework.io/extension-77972 patched

- lastTransitionTime: "2025-03-04T07:16:27Z"
    message: 'error upgrading from currently installed version "0.1.0": no bundles
      found for package "nginx77972" matching version "0.2.0"'
    observedGeneration: 2
    reason: Retrying
    status: "True"
    type: Progressing
  - lastTransitionTime: "2025-03-04T07:16:35Z"
    message: 'error upgrading from currently installed version "0.1.0": no bundles
      found for package "nginx77972" matching version "0.2.0"'
    observedGeneration: 2
    reason: Failed
    status: "False"
    type: Serving
  install:
    bundle:
      name: nginx77972.v0.1.0
      version: 0.1.0

5, upgrade the ClusterExtension to a right version
xzha@xzha1-mac OCP-77972 % oc patch ClusterExtension extension-77972 -p '{"spec":{"source":{"catalog":{"version":"1.0.0"}}}}' --type=merge
clusterextension.olm.operatorframework.io/extension-77972 patched

  - lastTransitionTime: "2025-03-04T07:16:27Z"
    message: desired state reached
    observedGeneration: 3
    reason: Succeeded
    status: "True"
    type: Progressing
  - lastTransitionTime: "2025-03-04T07:16:35Z"
    message: 'error upgrading from currently installed version "0.1.0": no bundles
      found for package "nginx77972" matching version "0.2.0"'
    observedGeneration: 2
    reason: Failed
    status: "False"
    type: Serving
  install:
    bundle:
      name: nginx77972.v1.0.0
      version: 1.0.0

 the error is still there, won't be cleared   

the error should be cleared