Outside of Game Pass, it hasn’t been in a great place for a while.
Games sell consoles, and they were fortunate to have lightning-in-a-bottle in Halo as their big launch game back in 2001. For exclusive software offerings, they’ve been coasting on that while also having some success with Gears, Fable, Forza. Thing is, when their competition isn’t shitting the bed, that hasn’t been enough.
Xbox has had some very favorable external, unusual circumstances over the years, starting from a not-insignificant number of consoles being sold as DVD players (especially when PS2s were out of stock). Sony launches an overengineered console hostile to both developers and consumers, leading to Xbox 360 being the go-to third party console. Finally, the fact that the Xbox brand never got a foothold in the Japan market becomes less relevant by the day as the home console market there continues to shrink.
Services like Game Pass hit a subscriber cap pretty quickly, so if they want growth there, they have to sell more consoles. Microsoft has done what they can to get those exclusives over the years, being early to invest in the indie space, and acquiring Mojang. Now since Game Pass, they are even more aggressive, picking up Bethesda and ABK. I don’t know if any of this will lead to something along with Master Chief being the face of the brand, but Xbox will be in a much better place if something does get there.