Is Gary's mod dead?

GMod is not dead by any means, but, the userbase has certainly decreased for multiple reasons. The two major ones I can think of off the top of my head are just people growing out of the game and a decrease in performance and server longevity as people load piles of addons onto barely-running setups without any tweaking.

Server longevity is decided primarily on user-friendliness and survivability of Source's schizophrenia, both of which usually require better hosting solutions, proper optimizations, and competence from staff. The larger active servers from what I've seen either run higher-tier VDS at various companies or some sort of bare-metal solution like I'm planning on doing