as Adobe documentation says, AEM stage and prod Cloud environments are updated transparently on a regular basis, even once a day. Also AEM updates are performed independently from custom project code updates (please correct me if I'm wrong).
If that's true - what would happen if some AEM update requires updates in project's code? How can we assure that our project is compatible with each AEM update, and prevent regression on PROD environment?
For example, is there any extension/check point in AEM automatic updates process/pipeline that allows to perform custom functional tests on stage environment updated with NEWEST (updated) AEM version, to make sure that everything works fine, BEFORE prod environment is updated with this newest AEM version?
There is extensive testing involved as part of the update and it will create an image first. If there are some issues then the instance is kept to the previous state. Also as mentioned in the doc, since AEM as a Cloud Service evolves on a daily basis, based on the projects implemented by our customers. Content, code and configurations are constantly reviewed and vetted against best practices.
While deploying your code on AEM instance via pipelines we have strict security scans and tests that are in place to make sure the custom changes do not intervene with product code.