Microservices are small, autonomous, harmonic subsystems that work together to solve the bigger problem.
The core idea of microservices is Divide and Conquer. We break the big problem into smaller sub-problems, and solve each of the sub-problem optimally, enabling us to solve the bigger problem well.
Codebase grows over time
The product evolves and new features are added to it and that bloats up the codebase. It becomes difficult for multiple teams to coordinate and collaborate on a humungous codebase. One team breaking one module can take down the entire product.
Scaling is predictable
With microservices, scalability becomes predictable; you can linearly amplify the infrastructure requirements of individual microservices and be predictable in handling the load.
Teams become autonomous
With each team responsible for a set of microservices they can take charge of their tech stack and design decisions. These decisions will be best for their problem statement and can ensure that they are solving them the best way possible.
If one microservice is down, it may lead to a partial outage of the product affecting a small fragment of the systems; while other components remain unaffected and can continue to service the traffic.
Upgrades are simpler
So long as a microservice adheres to the API contract, the team that owns it can upgrade the tech stack, architecture, and DB seamlessly.