If you click the ▼ on the right side of the hammer icon (Build), you can choose between Debug and Release.
Debug is a mode that is assumed to be used during debugging. Since logical compression is not performed at build time, source code and object code are completely associated one-to-one. (line by line of source code is maintained). Therefore, it is suitable for debugging using breakpoints.
Release is a mode that is assumed to be used in the final stage of design. Performs logical compression and optimizes code size. It is not suitable for debugging because logical compression makes it impossible to compare source code and object code. (There are restrictions on step execution and use of breakpoints.)

Please also check the Silicon Labs community site.