I honestly don't understand the popularity of VS Code, at all. If I wanted to cobble together a development environment from scratch, I'd just go use Emacs. Hell, I'd end up with a better product than a bunch of buggy as VS Code plugins that don't constantly act up and regularly break.
While I wouldn't consider my employer a '.Net shop' anymore, it's a fact that it still remains the most used language across the organization. Many of my coworkers have ditched Visual Studio, jumped to VS Code, gotten pissed off at it after a while, tried Rider, and eventually switched.
If anything, I think VS Code is in an incredibly unhealthy state. Sure, Microsoft initially managed to pull a Chrome with it and ate the lunch of a lot of more basic text editors, but many people are getting frustrated with the ecosystem. Really, between Spacemacs and Neovim, actual community-driven projects are coming out with much more polished and better integrated tools than Microsoft - partly thanks to them pushing everyone and their dog to build language servers. I'm sticking to proper IDE's for basically everything but the occasional itch I have to do something in lisp, but hot damn does what you get out of the box thanks to LSP support and tree-sitter make VS Code less appealing to people willing to make the switch.