Ancelotti's decision to extend his contract with Real Madrid until 2026 indicates that he is not satisfied with what has been achieved at club level. Of course this is welcomed by Real Madrid and all fans, but there is no guarantee for him to win many titles during the term of his contract.
So far Real Madrid has a good squad to win several domestic competitions, but I doubt they can win titles on the European stage without a productive striker. So far, Real Madrid has only relied on Bellingham, but Real Madrid always finds it difficult to win matches when Bellingham's performance is not good. That is one of the homework assignments for Real Madrid this season, but Madrid will probably improve their squad in the next transfer window.
It can be said like that, because if you look at the condition of Ancelotti now, especially when discussing about age, it should have entered retirement age for a coach but it seems that he does not want to leave quickly in this case and re-extend for 2 seasons, actually it is very long for an Ancelotti and maybe with this Madrid is the last club he will defend before really taking a break from his career in football.
On the other hand, with this indirectly also that the rumors about several names such as Xabi, Nagelsmann and of course Zidane are no longer meaningful for Madrid because it will only prepare for competition with the squad that Ancelotti has designed from the previous few seasons, especially for young players who have become Ancelotti's long-term project so far.