diff --git a/.gitlab/TagInitializationErrors.java b/.gitlab/TagInitializationErrors.java
index 3fdf8357a74..ad6edf267f6 100644
--- a/.gitlab/TagInitializationErrors.java
+++ b/.gitlab/TagInitializationErrors.java
@@ -1,44 +1,51 @@
-import org.w3c.dom.Element;
-import javax.xml.XMLConstants;
-import javax.xml.parsers.DocumentBuilderFactory;
-import javax.xml.transform.OutputKeys;
-import javax.xml.transform.TransformerFactory;
-import javax.xml.transform.dom.DOMSource;
-import javax.xml.transform.stream.StreamResult;
 import java.io.File;
 import java.nio.file.Files;
 import java.util.ArrayList;
 import java.util.LinkedHashMap;
 import java.util.List;
 import java.util.Map;
+import javax.xml.XMLConstants;
+import javax.xml.parsers.DocumentBuilderFactory;
+import javax.xml.transform.OutputKeys;
+import javax.xml.transform.TransformerFactory;
+import javax.xml.transform.dom.DOMSource;
+import javax.xml.transform.stream.StreamResult;
+import org.w3c.dom.Document;
+import org.w3c.dom.Element;
 
-/// Tags intermediate `initializationError` retries with `dd_tags[test.final_status]=skip`.
+/// Tags synthetic testcases (`initializationError`, `executionError`, `test exception`) with
+/// `dd_tags[test.final_status]=skip` so Test Optimization does not treat them as real failures.
+/// The script is idempotent — testcases that already carry a `dd_tags[test.final_status]` property
+/// are left unchanged.
+///
+/// **`initializationError`** — Gradle generates these for setup methods. When retried and
+// eventually
+/// successful, multiple testcases appear; only the last one passes. All intermediate attempts are
+/// tagged skip. Groups with only one (or zero) `initializationError` entries per classname are left
+// unmodified.
 ///
-/// Gradle generates synthetic "initializationError" testcases in JUnit reports for setup methods.
-/// When a setup is retried and eventually succeeds, multiple testcases are created, with only the
-/// last one passing. All intermediate attempts are marked skip so Test Optimization is not misled.
+/// **`executionError`** and **`test exception`** — Framework-level synthetic failures that do not
+/// represent real test results. Tagged skip unconditionally so Test Optimization treats them as
+// non-failures.
 ///
-/// For any suite with multiple `initializationError` test cases (when retries occurred), all entries
-/// but the last one are tagged by this script with `dd_tags[test.final_status]=skip`. The last
-/// entry is left unmodified, allowing **Test Optimization** to apply its default status inference based
-/// on the actual outcome. Files with only one (or zero) `initializationError` test cases are left unmodified.
+/// Before (two retries of the same class — first is intermediate, second is the final outcome):
 ///
-/// Before:
-/// 
 /// ```
-/// <testcase name="initializationError" />
+/// <testcase name="initializationError" classname="com.example.MyTest" />
+/// <testcase name="initializationError" classname="com.example.MyTest" />
 /// ```
-/// 
-/// After:
-/// 
+///
+/// After (only the intermediate attempt is tagged; the last entry is left untouched):
+///
 /// ```
-/// <testcase name="initializationError">
+/// <testcase name="initializationError" classname="com.example.MyTest">
 ///   <properties>
-///     <property name="dd_tags[test.final_status]" value="skip" /> 
+///     <property name="dd_tags[test.final_status]" value="skip" />
 ///   </properties>
 /// </testcase>
+/// <testcase name="initializationError" classname="com.example.MyTest" />
 /// ```
-/// 
+///
 /// Usage (Java 25): `java TagInitializationErrors.java junit-report.xml`
 
 class TagInitializationErrors {
@@ -61,54 +68,73 @@ public static void main(String[] args) throws Exception {
     var doc = dbf.newDocumentBuilder().parse(xmlFile);
     var testcases = doc.getElementsByTagName("testcase");
     Map<String, List<Element>> byClassname = new LinkedHashMap<>();
+    boolean modified = false;
     for (int i = 0; i < testcases.getLength(); i++) {
       var e = (Element) testcases.item(i);
-      if ("initializationError".equals(e.getAttribute("name"))) {
+      var name = e.getAttribute("name");
+      if ("initializationError".equals(name)) {
         byClassname.computeIfAbsent(e.getAttribute("classname"), k -> new ArrayList<>()).add(e);
+      } else if ("executionError".equals(name) || "test exception".equals(name)) {
+        if (tagSkip(doc, e)) modified = true;
       }
     }
-    boolean modified = false;
     for (var group : byClassname.values()) {
-      if (group.size() <= 1) continue;
       for (int i = 0; i < group.size() - 1; i++) {
-        var testcase = group.get(i);
-        var existingProperties = testcase.getElementsByTagName("properties");
-        if (existingProperties.getLength() > 0) {
-          var props = (Element) existingProperties.item(0);
-          var existingProps = props.getElementsByTagName("property");
-          boolean alreadyTagged = false;
-          for (int j = 0; j < existingProps.getLength(); j++) {
-            if ("dd_tags[test.final_status]".equals(((Element) existingProps.item(j)).getAttribute("name"))) {
-              alreadyTagged = true;
-              break;
-            }
-          }
-          if (alreadyTagged) continue;
-          var property = doc.createElement("property");
-          property.setAttribute("name", "dd_tags[test.final_status]");
-          property.setAttribute("value", "skip");
-          props.appendChild(property);
-        } else {
-          var properties = doc.createElement("properties");
-          var property = doc.createElement("property");
-          property.setAttribute("name", "dd_tags[test.final_status]");
-          property.setAttribute("value", "skip");
-          properties.appendChild(property);
-          testcase.appendChild(properties);
+        if (tagSkip(doc, group.get(i))) {
+          modified = true;
         }
-        modified = true;
       }
     }
-    if (!modified) return;
+    if (!modified) {
+      return;
+    }
     var tmpFile = File.createTempFile("TagInitializationErrors", ".xml", xmlFile.getParentFile());
     try {
       var transformer = TransformerFactory.newInstance().newTransformer();
       transformer.setOutputProperty(OutputKeys.ENCODING, "UTF-8");
       transformer.transform(new DOMSource(doc), new StreamResult(tmpFile));
-      Files.move(tmpFile.toPath(), xmlFile.toPath(), java.nio.file.StandardCopyOption.REPLACE_EXISTING);
+      Files.move(
+          tmpFile.toPath(), xmlFile.toPath(), java.nio.file.StandardCopyOption.REPLACE_EXISTING);
     } catch (Exception e) {
       tmpFile.delete();
       throw e;
     }
   }
+
+  static Element firstChildElement(Element parent, String tagName) {
+    var children = parent.getChildNodes();
+    for (int i = 0; i < children.getLength(); i++) {
+      var child = children.item(i);
+      if (child instanceof Element e && tagName.equals(e.getTagName())) {
+        return e;
+      }
+    }
+    return null;
+  }
+
+  static boolean tagSkip(Document doc, Element testcase) {
+    var props = firstChildElement(testcase, "properties");
+    if (props != null) {
+      var children = props.getChildNodes();
+      for (int j = 0; j < children.getLength(); j++) {
+        if (children.item(j) instanceof Element e
+            && "property".equals(e.getTagName())
+            && "dd_tags[test.final_status]".equals(e.getAttribute("name"))) {
+          return false;
+        }
+      }
+      var property = doc.createElement("property");
+      property.setAttribute("name", "dd_tags[test.final_status]");
+      property.setAttribute("value", "skip");
+      props.appendChild(property);
+    } else {
+      var properties = doc.createElement("properties");
+      var property = doc.createElement("property");
+      property.setAttribute("name", "dd_tags[test.final_status]");
+      property.setAttribute("value", "skip");
+      properties.appendChild(property);
+      testcase.appendChild(properties);
+    }
+    return true;
+  }
 }
diff --git a/.gitlab/collect_results.sh b/.gitlab/collect_results.sh
index dec34ed5d59..0df4a213cfa 100755
--- a/.gitlab/collect_results.sh
+++ b/.gitlab/collect_results.sh
@@ -90,7 +90,7 @@ do
     echo " (non-stable test names detected)"
   fi
 
-  echo "Add dd_tags[test.final_status] property on retried synthetics testcase initializationErrors"
+  echo "Add dd_tags[test.final_status] property on retried synthetics testcase initializationErrors, and all executionError and test exception synthetic testcases"
   $JAVA_25_HOME/bin/java "$(dirname "$0")/TagInitializationErrors.java" "$TARGET_DIR/$AGGREGATED_FILE_NAME"
 
   echo "Add dd_tags[test.final_status] property to each testcase on $TARGET_DIR/$AGGREGATED_FILE_NAME"
diff --git a/dd-java-agent/instrumentation-testing/src/main/groovy/datadog/trace/agent/test/base/HttpServerTest.groovy b/dd-java-agent/instrumentation-testing/src/main/groovy/datadog/trace/agent/test/base/HttpServerTest.groovy
index c30c8c394b8..03fced9538e 100644
--- a/dd-java-agent/instrumentation-testing/src/main/groovy/datadog/trace/agent/test/base/HttpServerTest.groovy
+++ b/dd-java-agent/instrumentation-testing/src/main/groovy/datadog/trace/agent/test/base/HttpServerTest.groovy
@@ -1248,7 +1248,7 @@ abstract class HttpServerTest<SERVER> extends WithHttpServer<SERVER> {
   }
 
   @Flaky(value = "https://github.com/DataDog/dd-trace-java/issues/9396", suites = ["PekkoHttpServerInstrumentationAsyncHttp2Test"])
-  def "test exception"() {
+  def "Instrumentation test exception"() {
     setup:
     def method = "GET"
     def body = null