@DynamicLabels generates non-parametrized query with dynamic node labels REMOVE node:<oldLabels> SET node:<newLabels> (source code).

A non-parametrized query is generated even when there is no change in the dynamic labels, e.g. REMOVE node:LabelA SET node:LabelA for a node entity with dynamic label LabelA.

When the number of dynamic labels is greater than Cypher query cache size (default 1000), this leads into a query cache overflow and causes replanning of other well-parametrized queries.

Since Neo4j 5.26, can node labels can be parametrized in this query as REMOVE node:$($oldLabels) SET node:$($newLabels)?

Node labels from @Node annotation are perfectly fine to be formatted into the query as-is (non-parametrized), as they are ensured to be constants by Java. It's only @DynamicLabels which allow any string causing this issue.