In a large pot over medium heat, cook thick-cut bacon until crispy, about 6-8 minutes. Remove bacon and chop into bite-sized pieces.

Add 2 tablespoons of butter or olive oil and sauté diced onion and sliced carrots for 10-15 minutes until softened and caramelized.

Pour in 4 cups of chicken broth and bring to a gentle simmer, about 3-5 minutes.

Stir in 1 cup of heavy cream or half-and-half, along with salt, pepper, garlic, thyme, and red chili flakes; let simmer for another 5 minutes.

Gradually add 2 cups of shredded cheddar cheese, stirring until melted and smooth, about 2-3 minutes.

Stir in 16 ounces of gnocchi and cook until they float, about 2 minutes. Add chopped bacon back to the pot and adjust seasoning as necessary.