I would like to thank @Harpreet for pointing me in the right direction. As he pointed out Cal.com uses a monorepo structure, so running npx prisma generate --schema=./prisma/schema.prisma
from the repo root will not work.

Tip: Use Git Bash in VS code.

1. Option A: find prisma workspace

cd packages/prisma and then run yarn prisma generate

2. Option B: repo root

Alternatively, from the repo root, you can run this syntax

yarn workspace @calcom/prisma prisma generate