diff --git a/src/libs/kata-types/src/initdata.rs b/src/libs/kata-types/src/initdata.rs
index efa7b502a8..c6841e1c28 100644
--- a/src/libs/kata-types/src/initdata.rs
+++ b/src/libs/kata-types/src/initdata.rs
@@ -246,7 +246,7 @@ pub fn add_hypervisor_initdata_overrides(initdata_annotation: &str) -> Result<St
         return Ok("".to_string());
     }
 
-    decode_initdata(initdata_annotation)?.to_string()
+    decode_raw_initdata(initdata_annotation).context("decoding initdata annotation failed")
 }
 
 use std::io::Write;
@@ -335,7 +335,9 @@ url = 'http://kbs-service.xxx.cluster.local:8080'
         assert!(result.is_err());
 
         let error = result.unwrap_err();
-        assert!(error.to_string().contains("base64 decode"));
+        assert!(error
+            .chain()
+            .any(|e| e.to_string().contains("base64 decode")));
     }
 
     #[test]
@@ -348,7 +350,9 @@ url = 'http://kbs-service.xxx.cluster.local:8080'
         assert!(result.is_err());
 
         let error = result.unwrap_err();
-        assert!(error.to_string().contains("gz decoder failed"));
+        assert!(error
+            .chain()
+            .any(|e| e.to_string().contains("gz decoder failed")));
     }
 
     #[test]