Warning: The following contains SPOILERS for Superman and Lois season 2.
The Arrowverse Earth-Prime was meant to contain every superhero show on The CW following the Crisis on Infinite Earths event, but the super friends in the new Justice League for help, firmly establishing that this version of Superman is the only superhero on his world.
When Superman & Lois first premiered, it was presumed to be a spinoff of the newly formed Earth-Prime.
The Superman & Lois season 2 finale, "Waiting For Superman," confirmed that it was set on an entirely different world, separate from Earth-Prime. This revelation came as General Sam Lane (Dylan Walsh) was trying to calm his panicking grandsons, who were worried about their father. General Lane told the boys that he had seen things they would not believe in his military career, including "glimpses of other worlds and the leagues of superheroes they have on them." He then added that while Superman was the only hero that their world had, that was fine because "he's the finest of any Earth."
The revelation that Superman is the only superhero on the Earth of Superman & Lois does much to explain what many had thought were story inconsistencies over the first two seasons. Chief among these were Arrow. This also explained story twists like Superman approaching his half-brother Tal-Rho for help instead of his cousin Kara Zor-El and why nobody ever thought to call the DEO or other superheroes in to assist with stopping an alien invasion.
Some viewers will likely be disappointed that Superman & Lois is not set on Earth-Prime and that there isn't a single, simple, unified Earth for all the Arrowverse series. However, it may be to the series' benefit for it to go its own way. Arranging The Flash continuing the Arrowverse storyline on television, it is probably best that Superman & Lois stands alone from now on.
Superman and Lois season 2 is now available on The CW app and will be on HBO Max on July 29, 2022.