According to the page that you apparently didn't read, it's based on the search text you typed and your city location.
Once enabled, Firefox Suggest sends what I type in the address bar to Mozilla. There it gets augmented with my location and makes its way to their "preferred partners", limited, for the moment, to a lovely establishment called "adMarketplace".
You don't see a slightest problem with that, no?
Reading through their "how Mozilla handles data" page [1] reveals absolutely nothing specific. What's collected, what's being passed on, etc. Just a bunch of hand waving and "don't you worry, everything is tip-top".
[1] https://blog.mozilla.org/data/2021/09/15/data-and-firefox-su...
If adMarketplace is just receiving from Mozilla a stream of (search text, city, clicked yes/no) then no, I don't see a problem with it.
If Mozilla sends a unique user ID as well then I would see a problem with it, but as far as I can tell, they don't.
Because this is on by default in FF93, be it a new install or an upgrade.
For now limited to the US, but it's safe to assume they are just testing waters.
The default, in friendly big blue colors, is to "Allow suggestions" with the alternative called "Customize in settings". It is also not clear if disabling "suggestions", switches off all its machinery or merely prevents them from being shown.
As others have said up this thread, the problem is not as much the feature itself, but the fact that Mozilla deemed it perfectly fine to roll out something like this in the first place.
It becomes increasingly obvious that Mozilla no longer understands (or cares!) what it was that made Firefox special, made people stick with it and what the motivation and priorities of these people are.