Optimization can be everything in general. So, including the size of things, speed, efficiency, etc.
In most cases, like the context you are describing, I believe optimization is considering the client’s average frame rate, stutters, netcode, etc.
Size doesn’t really matter for this if you are not aiming to optimize the size of the game. The size of the game should very rarely, if ever, have an influence on general performance. Optimizing the size of the user end product is sometimes a priority, sometimes not. With games, I don’t see much reason to be concerned with it other than the average global internet speed access or average device storage capacities. (Will vary depending on region and platform)
For example, a game being 50-150GB is acceptable due to its wide range of content capabilities.
A small text editor software being 50GB+ is a no-go. There’s not enough content to warrant spending that much space on such a small program. Plus, my users may not want to download such a large program for such little functionality.
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