In a statement to the Washington Post, Sony Interactive Entertainment President and CEO Jim Ryan explained that this was the percentage of backwards compatible titles out of the thousands that had been tested.
This data will calm down a little bit after the announcement of PS Plus Collection, a selection of eighteen titles that will be integrated into the PlayStation Plus service on PlayStation 5, was interpreted by some users as a kind of paid backwards compatibility.
However, Sony’s communication regarding backward compatibility remains brief. Beyond that “99%” of backwards compatible PlayStation 4 games we don’t know much more. It is not known if there will be improvements, as with Xbox backwards compatibility, or which titles will not work and why (one of the reasons might be incompatible peripherals). What seems almost certain, in the absence of an official statement, is that there will be no backward compatibility with previous generations such as PlayStation 2 or PlayStation 3. Neither has anything been said about the format (physical or digital), although it is assumed that backward compatibility will work in both cases.