Earlier quoted context omitted.
Or maybe raw performance isn’t always the most important attribute of a system?
Not directly, but cost usually it is. Being able to serve the same number of customers with less computational power means reducing your cost.
Most businesses do not have a constant workload 24/7, which means the ability to scale up and down will save more money than reducing the overhead of not running directly on metal.
There is also the cost of having to care about hardware to begin with.
Also, in the big picture, having 100 companies doing their own bare metal deployments is not terrible efficient, compared to 1 company doing that and 99 paying the first company for this service.
The list could go on, but I think you get my point.