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Paper · arXiv

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

Agents that work for many turns outgrow the context window of the model that serves them, and on small language models (SLMs) and constrained inference systems that window is small. Context compaction replaces older turns with a summary so a session can continue, but it is lossy, costs a model call, and can help or hurt depending on when it runs. We describe Bud ContextCompact 2.0, the compaction built into the Bud agent runtime, and evaluate it in two settings. On recall questions over recorded agent sessions, compaction to a 16K budget raised a 1.2B-parameter model's accuracy to 0.335, from 0.247 with truncation and 0.176 with its full 32K history (p < 0.001), and raised a 9B model from...

AuthorsJithin VG, Ditto PS
Primary categorycs.AI
Published18 October 2026
Last updated at source18 October 2026
cs.AI
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