Aside from assorted fees, credit card companies make money by charging interest on borrowed money.

If you pay off your balance in full at the end of the month, you are effectively borrowing no money from them. If you don't borrow any money from them, they can't charge you any interest, and if they can't charge you any interest then they can't make any money off you aside from the pittance you pay in annual fees or whatever else they might charge you.

So if a person has been paying off their balance every month, not carrying a balance, and not making any money for the credit card company, the credit card company will raise that person's limit to tempt them into perhaps buying enough stuff with the credit card such that they will not be able to pay the balance in full at the end of the month. Then the money borrowing begins, and the credit card company starts charging interest, and once they charge interest, they make money.