It's like asking why do people use Serviced Offices which are usually 10x the price of a monthly rented office. Answers: because they only need the office / VM for a few hours. Because they can immediately get an office / VM of any size they need. Because they can walk away from the office / VM when they don't need it any longer. It's certainly not for everyone, but Regus seem to be doing ok.
And for those who truly only need it now and again, it's great.
But time and time again I see infrastructure where people pay for these services for large amount of instances that are running continuously, blindly assuming that it's cheap because it's cloud. There's a bizarre level of price-blindness amongst certain subset of customers of Google Cloud and AWS that I've never seen anywhere else.
