Chrome Version: 49.0.2623.112 (Official Build) (64-bit)
Chrome OS Version: 7834.70.0 (Official Build) stable-channel
Chrome OS Platform: samus

Steps to reproduce:
1. Open browser 
2. Navigate to Chrome:settings 
3. Enable onscreen keyboard (if not already enabled)
4. Click in chrome:settings search box 
5. Type "notif" 
6. Press Space (will auto complete to "notify")
7. Press backspace twice (will shorten back to "notif" and bring cursor directly in front of "f" in "notif"
8. Type "catio" to complete the word to start completing the word "notification" 
9. Press space

Expected result: 
Will auto complete "notificatio" to "notification"

Actual result: 
Will auto complete "notificatio" to "notifI cation". Auto complete only recognizes the "icatio" and auto completes that to "I cation". 

How frequently does this problem reproduce? Always

What is the impact to the user, and is there a workaround? If so, what is
it?
If space is hit by mistake when typing using the onscreen keyboard that word will not be able to be completed unless completely backspaced as auto complete will take over and change the word. The workaround would be not to use the onscreen keyboard or to completely delete words that need to be finished/re-written after space is pressed.