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AI Agents · Lesson

Identifying Slow and Expensive Steps

Waterfall profiling: where is the agent spending its time and budget?

Identifying Slow and Expensive Steps is a free AI Agents lesson on CoddyKit — lesson 3 of 4. You can read the complete lesson below for free — then practise it hands-on in the browser with a built-in code editor and a 24/7 AI tutor. It is part of the AI Agents learning path, one of 4 lessons in the course, and your progress syncs across the web and the CoddyKit app.

Performance Profiling for Agents

Agent performance issues fall into two categories: slow steps (high latency) and expensive steps (high token cost). Both hurt user experience and operational costs. The first step is measurement.

Timing Each Step

Use time.perf_counter() for high-precision timing. It measures wall-clock time including I/O waits — exactly what matters for agent step latency.

import time
from contextlib import contextmanager

@contextmanager
def timer(step_name: str, timings: dict):
    start = time.perf_counter()
    try:
        yield
    finally:
        end = time.perf_counter()
        duration_ms = (end - start) * 1000
        timings[step_name] = duration_ms
        print(f'{step_name}: {duration_ms:.1f}ms')

# Usage
timings = {}

with timer('entity_extraction', timings):
    time.sleep(0.05)  # Simulate work

with timer('vector_search', timings):
    time.sleep(0.12)  # Simulate work

with timer('llm_call', timings):
    time.sleep(0.80)  # Simulate LLM latency

print('\nTimings:', timings)
print('Slowest step:', max(timings, key=timings.get))

Building a Step Profiler

A step profiler wraps each agent step and records timing and cost. It generates a waterfall chart of step durations when the run completes.

import time
from dataclasses import dataclass, field
from typing import List, Optional

@dataclass
class StepProfile:
    name: str
    start_ms: float
    end_ms: float
    duration_ms: float
    prompt_tokens: int = 0
    completion_tokens: int = 0
    cost_usd: float = 0.0
    error: Optional[str] = None

class StepProfiler:
    def __init__(self):
        self.steps: List[StepProfile] = []
        self.run_start = time.perf_counter()
    
    def start_step(self, name: str) -> float:
        return time.perf_counter()
    
    def end_step(self, name: str, start_time: float, tokens: dict = None, error: str = None):
        end = time.perf_counter()
        run_elapsed = (start_time - self.run_start) * 1000
        duration = (end - start_time) * 1000
        
        profile = StepProfile(
            name=name,
            start_ms=run_elapsed,
            end_ms=run_elapsed + duration,
            duration_ms=duration,
            error=error
        )
        if tokens:
            profile.prompt_tokens = tokens.get('prompt', 0)
            profile.completion_tokens = tokens.get('completion', 0)
        self.steps.append(profile)
        return profile

profiler = StepProfiler()
t = profiler.start_step('entity_extraction')
time.sleep(0.05)
profiler.end_step('entity_extraction', t, {'prompt': 200, 'completion': 50})
print('Step recorded:', profiler.steps[0].duration_ms)

Waterfall Chart in Terminal

Print a simple ASCII waterfall chart of step timings. This visually shows which steps run when and how long they take — like a browser's network waterfall but for agents.

class Step:
    def __init__(self, name, start_ms, end_ms, error=False):
        self.name, self.start_ms, self.end_ms, self.error = name, start_ms, end_ms, error
    @property
    def duration_ms(self):
        return self.end_ms - self.start_ms

class StepProfiler:
    def __init__(self, steps):
        self.steps = steps

def print_waterfall(profiler):
    if not profiler.steps:
        print('No steps recorded')
        return

    total_ms = max(s.end_ms for s in profiler.steps)
    bar_width = 50

    print('\n=== Agent Step Waterfall ===')
    for step in profiler.steps:
        start_pos = int(step.start_ms / total_ms * bar_width)
        end_pos = int(step.end_ms / total_ms * bar_width)
        bar = ' ' * start_pos + '#' * max(1, end_pos - start_pos) + ' ' * (bar_width - end_pos)
        status = 'ERR' if step.error else '   '
        print(f'{status} {step.name:<20} {step.duration_ms:>6.0f}ms  |{bar}|')

    print(f'\nTotal run: {total_ms:.0f}ms')

profiler = StepProfiler([Step('plan', 0, 120), Step('search', 120, 480), Step('generate', 480, 900, error=True)])
print_waterfall(profiler)

Collecting P95 Latency Across Runs

A single measurement is not enough. Collect timing data across many runs and compute P50, P95, and P99 latencies for each step. P95 latency is the threshold below which 95% of runs complete.

import statistics
from collections import defaultdict

class LatencyCollector:
    def __init__(self):
        self.step_durations = defaultdict(list)
    
    def record(self, step_name: str, duration_ms: float):
        self.step_durations[step_name].append(duration_ms)
    
    def percentile(self, data: list, pct: float) -> float:
        sorted_data = sorted(data)
        index = int(len(sorted_data) * pct / 100)
        return sorted_data[min(index, len(sorted_data) - 1)]
    
    def report(self):
        print('=== Latency Report (ms) ===')
        print(f'{"Step":<30} {"Count":>6} {"P50":>8} {"P95":>8} {"P99":>8} {"Max":>8}')
        print('-' * 75)
        for step_name, durations in sorted(self.step_durations.items()):
            p50 = self.percentile(durations, 50)
            p95 = self.percentile(durations, 95)
            p99 = self.percentile(durations, 99)
            max_d = max(durations)
            print(f'{step_name:<30} {len(durations):>6} {p50:>8.0f} {p95:>8.0f} {p99:>8.0f} {max_d:>8.0f}')

collector = LatencyCollector()
import random
for _ in range(100):
    collector.record('vector_search', random.gauss(120, 30))
    collector.record('llm_call', random.gauss(800, 150))
collector.report()

Identifying P95 Slow Steps

After collecting metrics, identify the steps whose P95 latency is disproportionately high. Focus optimization effort there — caching, parallelization, or model downgrades are common solutions.

class LatencyCollector:
    def __init__(self, step_durations):
        self.step_durations = step_durations
    def percentile(self, durations, p):
        s = sorted(durations)
        k = int(len(s) * p / 100)
        return s[min(k, len(s) - 1)]

def find_optimization_targets(collector, p95_threshold_ms=500):
    targets = []
    for step_name, durations in collector.step_durations.items():
        p95 = collector.percentile(durations, 95)
        avg = sum(durations) / len(durations)
        p95_to_avg_ratio = p95 / avg if avg > 0 else 0

        target = {
            'step': step_name,
            'p95_ms': round(p95),
            'avg_ms': round(avg),
            'p95_to_avg_ratio': round(p95_to_avg_ratio, 2),
            'call_count': len(durations),
            'needs_optimization': p95 > p95_threshold_ms
        }

        if target['needs_optimization']:
            if p95_to_avg_ratio > 2.0:
                target['suggestion'] = 'High variance: consider timeout and retry or caching'
            else:
                target['suggestion'] = 'Consistently slow: consider parallel execution or faster model'

        targets.append(target)

    targets.sort(key=lambda x: x['p95_ms'], reverse=True)
    return targets

collector = LatencyCollector({'search': [100, 150, 900], 'generate': [400, 420, 410]})
targets = find_optimization_targets(collector, p95_threshold_ms=500)
for t in targets:
    print(f"{t['step']}: P95={t['p95_ms']}ms, Avg={t['avg_ms']}ms, Action: {t.get('suggestion', 'OK')}")

Caching Expensive Tool Results

The most effective optimization for expensive steps is caching. If the same tool call (same inputs) is likely to be made again, cache the result and return it instantly next time.

import hashlib
import json
import time
from typing import Callable, Any

class ToolResultCache:
    def __init__(self, ttl_seconds: int = 300):
        self.cache = {}
        self.ttl = ttl_seconds
    
    def _make_key(self, tool_name: str, args: dict) -> str:
        content = json.dumps({'tool': tool_name, 'args': args}, sort_keys=True)
        return hashlib.sha256(content.encode()).hexdigest()[:16]
    
    def get_or_compute(self, tool_name: str, args: dict, compute_fn: Callable) -> Any:
        key = self._make_key(tool_name, args)
        now = time.time()
        
        if key in self.cache:
            entry = self.cache[key]
            if now - entry['ts'] < self.ttl:
                print(f'Cache HIT for {tool_name}')
                return entry['result']
        
        print(f'Cache MISS for {tool_name} - computing...')
        start = time.perf_counter()
        result = compute_fn(**args)
        elapsed = (time.perf_counter() - start) * 1000
        print(f'{tool_name} computed in {elapsed:.0f}ms')
        
        self.cache[key] = {'result': result, 'ts': now}
        return result

cache = ToolResultCache(ttl_seconds=60)

def expensive_web_search(query: str) -> list:
    time.sleep(0.2)  # Simulate slow API call
    return [f'Result for: {query}']

result1 = cache.get_or_compute('web_search', {'query': 'AI news'}, expensive_web_search)
result2 = cache.get_or_compute('web_search', {'query': 'AI news'}, expensive_web_search)  # Cache hit

Detecting Token-Heavy Steps

Identify steps that use disproportionately many tokens. Large prompts are often caused by including more context than needed or not truncating retrieved documents.

def find_token_heavy_steps(tracker: 'CostTracker', token_threshold: int = 2000) -> list:
    heavy_steps = []
    for step in tracker.steps:
        total_tokens = step.prompt_tokens + step.completion_tokens
        if total_tokens > token_threshold:
            heavy_steps.append({
                'step': step.step_name,
                'total_tokens': total_tokens,
                'prompt_tokens': step.prompt_tokens,
                'completion_tokens': step.completion_tokens,
                'cost_usd': step.cost_usd,
                'suggestions': []
            })
            entry = heavy_steps[-1]
            if step.prompt_tokens > token_threshold * 0.9:
                entry['suggestions'].append('Prompt is very large: truncate context documents or summarize')
            if step.completion_tokens > 1000:
                entry['suggestions'].append('Large output: use max_tokens limit if full response not needed')
    
    heavy_steps.sort(key=lambda x: x['total_tokens'], reverse=True)
    return heavy_steps

tracker = CostTracker()
tracker.record('answer_generation', 'gpt-4o-mini', 4500, 1200)
tracker.record('entity_extraction', 'gpt-4o-mini', 200, 50)
heavy = find_token_heavy_steps(tracker)
for s in heavy:
    print(f"{s['step']}: {s['total_tokens']} tokens, suggestions: {s['suggestions']}")

Model Downgrade Analysis

Not every step needs the most powerful model. Analyze which steps use expensive models and whether a cheaper model would suffice. Simple extraction tasks rarely need GPT-4o.

MODEL_TIERS = {
    'gpt-4o': {'tier': 'premium', 'capabilities': ['complex reasoning', 'nuanced writing']},
    'gpt-4o-mini': {'tier': 'standard', 'capabilities': ['extraction', 'classification', 'summarization']},
    'claude-3-haiku-20240307': {'tier': 'fast', 'capabilities': ['simple tasks', 'routing']}
}

STEP_MODEL_RECOMMENDATIONS = {
    'entity_extraction': 'gpt-4o-mini',
    'intent_classification': 'gpt-4o-mini',
    'simple_summarization': 'gpt-4o-mini',
    'complex_reasoning': 'gpt-4o',
    'final_answer_generation': 'gpt-4o-mini'
}

def audit_model_usage(tracker: 'CostTracker') -> list:
    recommendations = []
    for step in tracker.steps:
        recommended = STEP_MODEL_RECOMMENDATIONS.get(step.step_name)
        if recommended and recommended != step.model:
            current_cost = step.cost_usd
            # Estimate cost with recommended model (rough calculation)
            recommendations.append({
                'step': step.step_name,
                'current_model': step.model,
                'recommended_model': recommended,
                'potential_savings': 'significant' if step.model == 'gpt-4o' else 'moderate'
            })
    return recommendations

print('Model downgrade analysis function defined')

Profiling in Production

In production, sample profiling data rather than recording every run. Record 10-20% of runs in full detail and aggregate metrics for the rest. This keeps storage and overhead manageable.

import random

class SampledProfiler:
    def __init__(self, sample_rate: float = 0.1):
        self.sample_rate = sample_rate
        self.full_profiles = []
        self.aggregate_timings = defaultdict(list)
    
    def should_profile_full(self) -> bool:
        return random.random() < self.sample_rate
    
    def record_run(self, profiler: 'StepProfiler', full_profile: bool):
        # Always record aggregate timing
        for step in profiler.steps:
            self.aggregate_timings[step.name].append(step.duration_ms)
        
        # Only store full profiles for sampled runs
        if full_profile:
            self.full_profiles.append(profiler.steps)
    
    def get_summary(self) -> dict:
        return {
            'full_profiles_stored': len(self.full_profiles),
            'steps_tracked': {k: len(v) for k, v in self.aggregate_timings.items()}
        }

sampled = SampledProfiler(sample_rate=0.1)
print('Sampled profiler: recording 10% of runs in full detail')
print('Summary:', sampled.get_summary())

Combining Latency and Cost Signals

The most actionable optimization targets are steps that are both slow AND expensive. A step that is slow but cheap (one LLM call with small prompt) may not be worth optimizing. Focus on steps high on both dimensions.

def combined_optimization_priority(profiler: 'StepProfiler', tracker: 'CostTracker') -> list:
    # Build combined step data
    cost_by_step = {s.step_name: s.cost_usd for s in tracker.steps}
    
    combined = []
    for step in profiler.steps:
        cost = cost_by_step.get(step.name, 0)
        # Priority score: normalize and combine
        # High latency + High cost = top priority
        priority = (step.duration_ms / 1000) + (cost * 1000)  # Rough normalization
        combined.append({
            'step': step.name,
            'duration_ms': round(step.duration_ms),
            'cost_usd': round(cost, 6),
            'priority_score': round(priority, 3)
        })
    
    combined.sort(key=lambda x: x['priority_score'], reverse=True)
    return combined

print('Combined optimization priority function defined')
print('High priority = slow + expensive')

Knowledge Check: Performance Profiling

Test your understanding of agent performance profiling.

Performance Profiling Summary

Effective agent performance profiling uses: high-precision timing with time.perf_counter(), waterfall charts to visualize step overlaps, P95 latency collection across many runs, identification of token-heavy steps for truncation, tool result caching to eliminate repeated expensive calls, model downgrade analysis for cheaper step execution, and sampled profiling in production to keep overhead manageable.

Frequently asked questions

Is the “Identifying Slow and Expensive Steps” lesson free?

Yes — the full text of “Identifying Slow and Expensive Steps” is free to read here on the web, and the AI Agents course includes 4 lessons in total. To practise it interactively (a built-in code editor and a 24/7 AI tutor) and unlock the rest of the AI Agents course, upgrade to CoddyKit PRO.

What will I learn in “Identifying Slow and Expensive Steps”?

Waterfall profiling: where is the agent spending its time and budget? You practise AI Agents with hands-on code you run directly in the browser, and a 24/7 AI tutor answers your questions as you work through the lesson.

Do I need any experience to start AI Agents?

No prior experience is required. AI Agents on CoddyKit is structured for beginners through advanced learners; this is — lesson 3 of 4, so you can start here or from the beginning and move at your own pace.

How long does the “Identifying Slow and Expensive Steps” lesson take?

Most CoddyKit lessons take about 5–10 minutes. Each one is bite-sized and interactive, so you make steady progress and pick up exactly where you left off across the web and the app.

Can I write and run code in this AI Agents lesson?

Yes. Every AI Agents lesson includes a built-in code editor, so you write and run real code right in your browser and get instant AI feedback — no local setup required.

All lessons in this course

  1. Trace Analysis with LangSmith and Langfuse
  2. Per-Step Token and Cost Profiling
  3. Identifying Slow and Expensive Steps
  4. Root Cause Analysis for Agent Failures
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