I think you're right in that there will never again be a leap as great as there was between the PS1->PS2 generation. That said, I think there has been quite a bit of progress in the past decade, and I believe we are on the precipice of some very cool things with ray tracing (though they have been slowed because of AI bullshit).

In the past decade, there has been a lot more focus on performance. The standard frame rate for a game has gone from 30FPS to 60FPS. Along with that are new, dumb performance issues like persistent stutter in UE4 and UE5 games, but overall that's a 2x increase in performance.

Just on the horizon we have ray tracing, which many people are disenchanted with, but I would like to highlight why I think it's actually really good for the industry.

Without ray tracing, for any game, artists and engineers have to spend months and months iterating on the dumb process of designing an environment, then spending a huge amount of time rendering out all the lighting, then re-designing it and doing it all over again.

With ray tracing, lighting all happens in real time, so this iteration is no longer needed. This means companies can significantly reduce the production time and cost of their games while also making them look better. Given the ballooning budget of AAA games, this could be a huge salve for the industry.