Doubt on "scalability" of this architecture

The Architecture diagram states

> Mobile applications require a highly scalable backend infrastructure to support the variable usage created by mobile users. AWS Lambda runs code in response to requests and automatically manages and scales the underlying resources. Lambda Function 1 provides a synchronous endpoint for users to store and retrieve unstructured data from Amazon DynamoDB.

My doubt is the statement that this supports a "highly scalable backend". Since the API requests are served from Lambda functions which are inherently limited to 1000 concurrent connections by default. To support even 10K users using an app you would need a minimum of 10K Lambda sessions. Since this serverless architecture does not support connection pooling, many DBs will not support this amount of concurrent "clients". So my question is how is this "highly scalable"?