The text explores the concept of context engineering in building AI agents, emphasizing its importance in creating reliable, efficient, and personalized AI systems. Unlike prompt engineering, which focuses on crafting single inputs, context engineering involves designing the entire information flow, including instructions, history, and retrieved data, to improve AI performance and reduce costs. It highlights the need for a unified memory architecture to manage short-term and long-term memory, reducing complexity and latency by co-locating data. The text discusses the benefits of context engineering, such as improved reliability, reduced latency, enhanced capabilities for complex workflows, and personalization. It also explains the significance of performance in context engineering, emphasizing strategies like semantic caching and efficient retrieval to minimize latency and costs. The article concludes that context engineering will be crucial for developing future AI agents, shifting the focus from model training to the engineering of the information pipeline surrounding AI models.