When Sonic came on board the Death Egg, he almost immediately fought Silver Sonic. Silver Sonic attacked by charging at Sonic, or by dashing or jumping at him. Sonic jumped on him, avoiding the spines on his back, and eventually defeated him. Silver Sonic was destroyed in several explosions, leaving the way clear for Sonic to confront Eggman.
He reappears in the Sonic comics, implying he was repaired or otherwise re-created.