I don’t think the Xbox user base is in decline but I do think Xbox simmers in general are less serious; and therefore less likely to invest in add-ons. A friend of mine recently bought a Series X and he’s really happy just flying around the vanilla MSFS world. It’s something I couldn’t do, with all those awful looking, default airports. I’ve showed him some of my add-ons to tempt him to better his experience but there’s barely any interest.
Some people clearly just like the flying aspect and don’t really care what the airports or planes look like. To each his own.