Why is Xoops free of charge?

XOOPS is available at no costs because it is developed by a lot of people in their free time.
Anyone and everyone can contribute to the project as and when they have the time for it.

Also, a number of companies pay for custom development or have IT staff developing needed modules and adaptations and release those afterwards. This is the true spirit of Open Source and GPL licensing; to give something back to the community that gave them the XOOPS platform to build on.

This Q&A was found on XOOPS Web Application System : https://xoops.org/modules/smartfaq/faq.php?faqid=71