(1) Support website says yes on device : Dictation requests are processed on your device in many languages—no internet connection is required. When dictating in a search box, dictated text may be sent to the search provider in order to process the search. (https://support.apple.com/en-au/guide/iphone/iph2c0651d2/ios)
(2) Device documentation says it will show you if it’s on device or on cloud (it never does) : https://i.postimg.cc/d3pxT9cH/IMG-1661.jpg
There are other voice-to-text features, such as Translation, which may use the cloud, but those aren't in the context of the information you provided.
1. https://www.apple.com/legal/privacy/data/en/ask-siri-dictati...