Phonics is all about using sounds to read words. It gives new readers a toolkit to draw from when they encounter a word they've never seen before. It requires that children learn the sound that each alphabet letter makes, first. Then:
Let’s say that you learn that the letter c makes the “kuh” sound.
Next, you learn that the letter a makes the “ah” sound.
And the letter t makes the “tih” sound.
When you read those sounds together… “k-ah-t” you make the sound for “cat“.
You just learned to read the word “cat” using phonics.