There are different kinds of "cloud mining".

Quite many "providers" have been running true ponzi-scams, not even bothering to invest a cent into hardware, just collecting "investments" into a big pot, paying back a very good return on the investment from the pot. It's profitable for the scammer as long as the new investments are pouring in faster than the dividends are paid out. Finally the scammer runs away with the full pot and close down the "cloud mining"-business.

Other mining providers may be legitimate, leasing out hash power as a way of funding expansions of the mining farm. Still one should be lucky to make a real profit out of it.