I only use it for personal servers so calling it "production" is maybe debatable, but in my opinion NixOS is the end game of server distributions and indeed where it shines the most.
The single interface to manage the entire system including installed programs and service configuration makes it very easy to keep configuration between different services or even machines in sync. It's pretty much what ansible wants to be but it doesn't feel like it's held together by duck tape (note that doesn't mean there's no duck tape in NixOS, some things it does like fixed shared library paths kinda need it, but it's a lot more contained). And since it's all configured with a Turing-complete programming language, that means you can abstract your configuration however you need.
Checked configuration along with easy rollback also means that system upgrades are not a thing to worry about: if your configuration becomes invalid after a NixOS update (though I think there's no incompatible updates inside the same release branch unless you're running unstable), your system will fail to build, and if it does fail at runtime, you can just boot your old configuration.
Another highlight is the builtin VM build target which builds your configuration as a runnable VM for testing. I've used it a couple times to test new configuration such as when I was setting up Nextcloud, before pushing it to the actual server. (I'm just missing a good way to spin up multiple VMs in a virtual network for testing distributed services. I'm sure people have already done something like that outside of mainline NixOS, though.)
The only big issue I think it has is that the Nix language has a definite learning curve compared to other distros if you're not familiar with functional programming, and then NixOS and nixpkgs also introduce their own concepts, and centralized documentation can definitely be lacking (though there are efforts going towards fixing that) so a lot of the time you have to dig around for blog posts or read the source code. But overall I think getting over the initial hurdle until you're comfortable is so worth it.
I'm probably missing a lot of other stuff it has that I'm taking for granted at this point, but I think these are the major points.