They listened to their internal staff and stakeholders and public pressure, and did terminated the contract instead of ignoring it or doubling down.
That is a good thing.
However, even in the present, the increasing intrusiveness of their update schemes, forcing people to have a Microsoft account even to install Windows, shoving AI into people's faces at every opportunity, etc., would all count as reasons I think they are bad. Also I tend to think in general that simply existing as a giant corporation with large market share is bad.
To be clear, I also think that Apple, Google, Amazon, etc., are also very very bad. I think I'd agree that these days Microsoft is on the lower end of badness among these megacorps. However, that's partly just because it's become somewhat weaker than it was at the height of its badness. You could argue that this isn't "badness" but something like "ability to implement badness" but I see those as pretty closely tied. Basically the bigger a corporation becomes, the harder it has to work to avoid being bad.