Has anybody turned hobby into a successful/ profitable business?

I did. I probably turned a hobby of mine that I never thought I'd be able to monetize into a business. It's "successful" by most standards as it generates a few thousand dollars in MRR without me really having to do anything.

The business is selling embedded operating system software to manufacturers of pinball machines and other entertainment devices. I grew up in arcades, played lots of pinball and video games, and really took my nerdy "computer science-y" love for operating systems and architecture and molded it into something that a really small industry needed. This was born from me making my own games from scratch and needing an operating system that could support sudden power offs, real-time scheduling, "in-the-field" updates, etc.

I wrote about it here:
https://www.indiehackers.com/@jimmylipham/how-i-bootstrapped-my-arcade-side-project-to-3k-mo-87ce145b0a

I think hobbies are a fantastic lead-in to "building in a space you're passionate about". For example, if you're not really passionate about real-estate, then I probably wouldn't build a product targeting that audience.

I wouldn't have seen the level of response I did had I not been passionate about arcade games, pinball, etc.

Just my two cents! What are you passionate about?
-- Jimmy