I actually know quite a few (non-tech) people that love to use Copilot in those apps. So I'm not sure it's as big of a fuck-up as you think it is (or as I certainly used to think it is).
On profitable products though; sure as a general concept, but the rate of return, opportunity cost and market competition factor into the profitability equation too. You could go waste your time building a desktop app for a chatgpt clone and make some "profit" in the same time your competitor threw similar resources at making a claude code and that makes 100x your profit. That would mean you actually lost despite the profit. The opportunity cost isn't only in building the wrong thing, but also in the human resources you allocated to the task that deprived other areas. I see no world where the 6 dozen copilots we got from Microsoft have any good ROI beyond diluting a brand and making them more of a laughing stock.
We need to rewire ourselves to think about things that are beneficial to society as a whole. Not "profitable." Profit just means more money going from the many to the few. That's what's gotten us into this awful situation.
So fortunately, there's not really an incompatibility there.
Then due to typical clueless management and lack of taste and complete buffoonery, they just fucked it all up. I'm not complaining because I think everyone is better off, but it's just amazing to have witnessed that even when they luck out on a bet, they manage to fuck it up. Copilot started as a coding assistant, and before it could breath they destroyed the brand by shoving the name into literally everything without thinking or taste. Ignored the coding part, because that's lame, and instead focused on half assed Windows or Office apps and integrations that no one will ever use. Once claude code dominated the scene, they realized the major fuckup and tried to catch up, but it's too little too late.
Again, not complaining really.