Next.js is a modern JavaScript framework that optimizes page and application speed, development speed, and experience. To monitor its performance, you need to set up application performance monitoring for both the server side and browser monitoring. This involves installing the New Relic Node.js APM agent and middleware for Next.js, configuring your `newrelic.js` file, and integrating the New Relic Browser agent into your `_document.tsx` file. With this setup, you can view your application's performance data in New Relic, including server-side metrics such as Apdex score, throughput, and transactions, as well as browser-related metrics like largest contentful paint, input delay, AJAX requests, or page views. Additionally, you can send detailed error information to New Relic using the `_error.tsx` file, which captures both backend and frontend errors and sends them to New Relic's noticeError method. The setup also enables automatic logs in context options, allowing for correlated logging between transactions and logs. By following these steps, you can gain full-stack observability in your Next.js application and optimize its performance.