How does `jupyter labextension list` determine if an extension is outdated?

It does not know anything about new versions/releases of the extension; instead it compares what version of JupyterLab the extension requests/was built for and checks if this is older than the current version of JupyterLab.

Say your extension depends on packages @jupyterlab/something in version 2.0 but you are running JupyterLab 3.0 - this is when you should expect this error. The code that checks this is in:

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