If you have good enough engineers and manpower for distributed systems, you can also optimize your systems enough to fit again, if you are not a billion dollar company.
Distributed systems are exciting and interesting, but currently not worth their investment for 99% of the cases. Things might change though in some decades.
Generally speaking, the second you're running tricks to "jam" something that's overly large into a single machine, yeah you should just give up.
The issue becomes when you reach the scale of compute needs such that you cannot "jam" all your requirements into a single leader multiple node cluster.
The amount of data you'll need for THAT, is becoming unimaginable.
64 core 128 thread leader nodes have outrageous potential to scale.
That said, that doesn't quite apply to my Postgres example (barring some nifty DBA tricks and third party extensions).
But you can appreciate how much data you're going to need to blow past what 128 threads can do for you.
Distributed systems are exciting and interesting, but currently not worth their investment for 99% of the cases. Things might change though in some decades.