The overlay/override component is used when you want to USE an out of the box component in AEM and you want to add extra FEATURES to it and you want to CHANGE it across all instances of that component. For example if you want to add features to the out of the box “text” component, but you don’t want to create a new component, you would want to copy the “text” component from “libs/foundation/components” to “apps/foundation/components” and keep the same folder structure that is used. When this is done, any changes that done to this new component will be reflected in the out of the box “text” component, without changing the original CODE under “libs”. It is GENERALLY not a good practice to modify the original code, which is why CQ offers the ability to use overlays.

The overlay/override component is used when you want to use an out of the box component in AEM and you want to add extra features to it and you want to change it across all instances of that component. For example if you want to add features to the out of the box “text” component, but you don’t want to create a new component, you would want to copy the “text” component from “libs/foundation/components” to “apps/foundation/components” and keep the same folder structure that is used. When this is done, any changes that done to this new component will be reflected in the out of the box “text” component, without changing the original code under “libs”. It is generally not a good practice to modify the original code, which is why CQ offers the ability to use overlays.