diff --git a/ui/src/context/CompanyContext.test.tsx b/ui/src/context/CompanyContext.test.tsx
index 7faad85a4f..cd45f94531 100644
--- a/ui/src/context/CompanyContext.test.tsx
+++ b/ui/src/context/CompanyContext.test.tsx
@@ -137,6 +137,7 @@ describe("shouldClearStoredCompanySelection", () => {
       companies: [],
       isLoading: false,
       unauthorized: true,
+      errored: false,
     })).toBe(false);
   });
 
@@ -145,8 +146,23 @@ describe("shouldClearStoredCompanySelection", () => {
       companies: [],
       isLoading: false,
       unauthorized: false,
+      errored: false,
     })).toBe(true);
   });
+
+  it("does not clear the stored company selection when the request failed", () => {
+    // `companiesListQueryOptions` sets `retry: false`, and a failure before any
+    // success leaves `data` undefined — which the provider defaults to an empty
+    // list. That is indistinguishable from "asked, and owns nothing", so
+    // without this a single failed request on a cold load would drop the
+    // customer's stored company.
+    expect(shouldClearStoredCompanySelection({
+      companies: [],
+      isLoading: false,
+      unauthorized: false,
+      errored: true,
+    })).toBe(false);
+  });
 });
 
 describe("CompanyProvider", () => {
@@ -176,6 +192,30 @@ describe("CompanyProvider", () => {
     vi.clearAllMocks();
   });
 
+  it("keeps the stored company when the company request fails", async () => {
+    // The seam the predicate test above cannot reach: the provider defaults a
+    // failed request to an empty list, so the effect has to be told the
+    // request errored or it reads that as "asked, and owns nothing" and clears
+    // the customer's stored company.
+    localStorage.setItem("paperclip.selectedCompanyId", "company-a");
+    mockCompaniesApi.list.mockRejectedValue(new Error("companies unavailable"));
+
+    await act(async () => {
+      root.render(
+        <QueryClientProvider client={queryClient}>
+          <CompanyProvider>
+            <Probe onSelectedCompanyId={() => {}} />
+          </CompanyProvider>
+        </QueryClientProvider>,
+      );
+    });
+    await act(async () => {
+      await new Promise((resolve) => setTimeout(resolve, 0));
+    });
+
+    expect(localStorage.getItem("paperclip.selectedCompanyId")).toBe("company-a");
+  });
+
   it("does not expose a stale stored company id before companies load", async () => {
     localStorage.setItem("paperclip.selectedCompanyId", "stale-company");
     mockCompaniesApi.list.mockImplementation(() => new Promise(() => {}));
diff --git a/ui/src/context/CompanyContext.tsx b/ui/src/context/CompanyContext.tsx
index c653fd11af..5a0a3f7d8f 100644
--- a/ui/src/context/CompanyContext.tsx
+++ b/ui/src/context/CompanyContext.tsx
@@ -67,7 +67,24 @@ export function shouldClearStoredCompanySelection(input: {
   companies: Array<Pick<Company, "id">>;
   isLoading: boolean;
   unauthorized: boolean;
+  /**
+   * Whether the company request failed. An error is not an answer, and this
+   * branch is destructive.
+   *
+   * `companiesListQueryOptions` sets `retry: false`, and a request that fails
+   * before ever succeeding leaves `data` undefined - which the provider
+   * defaults to `{ companies: [], unauthorized: false }`. That is
+   * indistinguishable from "this account was asked, and owns nothing", so a
+   * single failed request on a cold load would clear the customer's stored
+   * company and drop them onto whichever company sorts first next time.
+   *
+   * Not clearing costs nothing: a stored id that no longer resolves is
+   * ignored by {@link resolveBootstrapCompanySelection}, which checks it
+   * against the current list before using it.
+   */
+  errored: boolean;
 }) {
+  if (input.errored) return false;
   return !input.isLoading && !input.unauthorized && input.companies.length === 0;
 }
 
@@ -89,7 +106,12 @@ export function CompanyProvider({ children }: { children: ReactNode }) {
   useEffect(() => {
     if (isLoading) return;
     if (companies.length === 0) {
-      if (shouldClearStoredCompanySelection({ companies, isLoading: false, unauthorized: companyListUnauthorized })) {
+      if (shouldClearStoredCompanySelection({
+        companies,
+        isLoading: false,
+        unauthorized: companyListUnauthorized,
+        errored: error !== null,
+      })) {
         if (selectedCompanyId !== null) {
           setSelectedCompanyIdState(null);
         }
@@ -108,7 +130,7 @@ export function CompanyProvider({ children }: { children: ReactNode }) {
     setSelectedCompanyIdState(next);
     setSelectionSource("bootstrap");
     localStorage.setItem(STORAGE_KEY, next);
-  }, [companies, companyListUnauthorized, isLoading, selectedCompanyId, sidebarCompanies]);
+  }, [companies, companyListUnauthorized, error, isLoading, selectedCompanyId, sidebarCompanies]);
 
   const setSelectedCompanyId = useCallback((companyId: string, options?: CompanySelectionOptions) => {
     setSelectedCompanyIdState(companyId);