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NOTE: For production, esbuild takes care of compilation and outputs compiled assets into assets/builds/ during asset compilation. It intelligently handles files by file extension (e.g. .jsx, .js, .ts, etc.). However, for testing, jest needs to do its own compilation both for the test files and for the files being tested. That's why you still need to set up babel for jest here.
NOTE: During precompilation rails just runs the build script in package.json. You can customize esbuild settings/options there.