Like any webapp they analyzed their paint times and made great performance improvements.
From the data structures of how they store lines and tokens of currently edited files, scrolling, refreshing changes on the screen etc they analyze perf, see what can be optimized and make it happen. Very few teams put perf above features at MS. Vscode is exceptional in that sense.
Also vscode uses processes quite a bit. The main app lives on one process, the language servers are all different processes, extensions are different processes etc. all communicating over jsonrpc
This means the main editor cannot get clogged by an extension hanging up or crashing.