Medium-sized sp-textfields are limited to a minimum width of 48px (this is true of the Spectrum Web Component version for the web as well).
There’s no provision for going smaller (and w/ the padding in the control, very much smaller would result in the inability to render any text).
You can go a little smaller with the small
sp-textfield in PS 22.5+ (currently in prerelease):
<!-- small text field minimum is 36px wide; room for 2 characters -->
<sp-textfield size="s" style="width: 36px">...</sp-textfield>
We’ll be adding an option (probably
appearance: none) that will enable you to drop the built-in styles, which would give a bit more freedom here (important for being able to edit a label in a card, for example, without adding extra borders), but it’s not something currently available. I do not have a TBD on when this will be available.