"android sdk update" command does not seem to cache its downloads
I'm not really sure this has ever worked — see Android bug #27988 from March 2012, for example.
I still have a bunch of related bugs open from around that time. When I implemented automated SDK/platform/tools installation for the Android Jenkins plugin, I wrote code to first check with android list target whether something was installed, because I think I couldn't rely on android update sdk to do the right thing.