Bud ContextCompact 2.0: Context Compaction for Agent Success and Accuracy with Small Language Models and Constrained Context Windows

Long horizon agentic tasks are now pushing LLM agents past their context window. To continue the task, the agent scaffold has to free up the context window, a process known as context compaction. Compaction is generally lossy by design: agents can silently lose task constraints, instructions, or their reasoning behind earlier decisions. Although compaction is a standard component of coding agent scaffolds, it has not been studied systematically with frontier models on realistic, long horizon agentic tasks. Previous work evaluate smaller open weight models on toy or synthetic trajectories. We fix the agent scaffold (OpenCode), implement five compaction strategies inside it, and evaluate three frontier models on three long horizon benchmarks (PaperBench, ProgramBench, PostTrainBench). For the two 1M context models, the compaction threshold does not measurably affect the task performance, whereas GPT-5.3-Codex, the model with the smallest context window, performs worse at lower thresholds on PaperBench and, less clearly, on PostTrainBench. No compaction method outperforms default self-summarization, and methods that discard more content cost some models up to 20 points while leaving other models the same. Compaction can, however, silently remove task constraints: on ProgramBench, the first compaction summary already drops about one third of the task's anticheating rules on average, and this rises monotonically with the number of compactions. On real user-agent sessions from SWE-chat, instructions about how the agent should work and what it should not do are dropped around 6 times more than specifications of what to build. We argue that current benchmarks are compaction-friendly: i.e., the objective is fixed and the agent's progress stays on disk, so most of what compaction discards can be recovered, except constraints that don't exist anywhere else.

Large Language Models (LLMs) have a bounded context window. The context window is the maximum input size an LLM can consume for a single inference. AI agents rely on a process called context compaction to fit their state within the context window when calling an LLM. Despite its ubiquity, context compaction has received essentially no formal analysis. In this paper, we initiate a formal study of context compaction. We first introduce a framework consisting of two games that capture the two algorithmic strategies for context compaction used by contemporary AI agents in practice. The Context Selection Game models context compaction algorithms that select a subset of an agent's accumulated state to retain. The Context Generation Game models context compaction algorithms that summarize an agent's state by an arbitrary message of bounded length. We then prove an equivalence between the Context Generation Game and one-way communication complexity. The minimum context compaction budget for answering a set of queries within a target error is equal to the one-way communication complexity of the induced communication problem at the same error. Known bounds from communication complexity therefore transfer directly to context compaction. We also show that the Context Selection Game corresponds to a restricted class of one-way communication protocols. Any gap between selection and generation is therefore a gap between two classes of communication protocols. We prove that there exists a set of queries for which generation needs strictly less budget than selection. The equivalence between the Context Generation Game and one-way communication also lets us measure how well a deployed context compaction algorithm performs on a query relative to the optimal strategy. As an example, we present a case study that evaluates Anthropic's context compaction endpoint on set membership queries.

Context compaction lets long-horizon coding agents continue beyond their context windows, but can erase the state needed to finish a task. Prior evaluations measure efficiency, retained information, or end-to-end success, leaving the effect of a specific history replacement difficult to isolate. Compact-Bench pairs full-history and summary-only continuations from a shared repository state, and evaluates recurring details and successive production compactions. It covers 35 SWE-bench repairs, 146 agentic sessions, and 106 production chains. Across 14 summarizer backbones, stable damage ranges from 5-64% of 22 full-history successes: Claude Opus 4.8 preserves the most repairs, while DeepSeek-Flash damages the most. With Kimi-K3 as summarizer, the Kimi Code prompt preserves the most task continuations (19/22), whereas Claude Code retains the most recurring details (15.0%). LLM summaries retain at most 16.0% of recurring details, compared with 79.1% for mechanical extraction; production summaries retain 15.7% at the first boundary. Failures recur across methods: one repair is damaged by 13/14 backbones, and another by all 5 prompts. These results show that reliable compaction requires preserving the progress needed to complete a task, and that retaining relevant information alone does not ensure successful continuation. Code is available at https://github.com/cai-jianfeng/compact-bench and data is available at https://huggingface.co/datasets/caijanfeng/compact-bench.