Performance is very much still a significant factor. At the end of the day, games are expected to run at certain FPS on certain machines. The machines have gotten better to the extent that unoptimized code can be used sometimes, but when competing for graphics, badly optimized games will have to sacrifice fidelity to hit performance targets, where well-optimized games can get squeeze out better graphics and hit those same targets.

There's plenty of tricks these days but optimized code will always have an edge.