Claude Code also doesn't read AGENTS.md by default if there's a CLAUDE.md it can read instead. This isn't limited to your repo, e.g. if you have a ~/CLAUDE.md then no AGENTS.md will be read.

To always read both, you have to switch the 'Project instructions' setting to the non-default `claude-md-and-agents-md`.

Just in case anyone is wondering why their AGENTS.md still isn't being read.