diff --git a/src/vs/base/node/terminalEncoding.ts b/src/vs/base/node/terminalEncoding.ts
index fdfc268c48a3d..32ff35ea028a4 100644
--- a/src/vs/base/node/terminalEncoding.ts
+++ b/src/vs/base/node/terminalEncoding.ts
@@ -40,7 +40,7 @@ const JSCHARDET_TO_ICONV_ENCODINGS: { [name: string]: string } = {
 const UTF8 = 'utf8';
 
 export async function resolveTerminalEncoding(verbose?: boolean): Promise<string> {
-	let rawEncodingPromise: Promise<string>;
+	let rawEncodingPromise: Promise<string | undefined>;
 
 	// Support a global environment variable to win over other mechanics
 	const cliEncodingEnv = process.env['VSCODE_CLI_ENCODING'];
@@ -54,7 +54,7 @@ export async function resolveTerminalEncoding(verbose?: boolean): Promise<string
 
 	// Windows: educated guess
 	else if (isWindows) {
-		rawEncodingPromise = new Promise<string>(resolve => {
+		rawEncodingPromise = new Promise<string | undefined>(resolve => {
 			if (verbose) {
 				console.log('Running "chcp" to detect terminal encoding...');
 			}