Deep learning recommendation models (DLRMs) have been used across many business-critical services at Meta and are the single largest AI application in terms of infrastructure demand in its data-centers. In this paper, we present Neo, a software-hardware co-designed system for high-performance distributed training of large-scale DLRMs. Neo employs a novel 4D parallelism strategy that combines table-wise, row-wise, column-wise, and data parallelism for training massive embedding operators in DLRMs. In addition, Neo enables extremely high-performance and memory-efficient embedding computations using a variety of critical systems optimizations, including hybrid kernel fusion, software-managed caching, and quality-preserving compression. Finally, Neo is paired with ZionEX, a new hardware platform co-designed with Neo's 4D parallelism for optimizing communications for large-scale DLRM training. Our evaluation on 128 GPUs using 16 ZionEX nodes shows that Neo outperforms existing systems by up to 40× for training 12-trillion-parameter DLRM models deployed in production.