profile picture not uploading

Because apparently the servers aren't enduring too much people.

The option has temporarily been disabled.

As people look to gaming for social connection, Xbox is seeing record numbers across Xbox Game Pass, Xbox Live, and Mixer. To streamline moderation and ensure the best experience for the community, Xbox has made small adjustments.
Some features like uploading custom gamerpics, club pics, and club backgrounds are temporarily disabled

Hi there this feature is not working at this time, no word yet on when it will be available

Just to expand on this what CyTeK1978 said, the option to upload custom gamer pics has been temporary disabled by Microsoft due the current global crisis, as custom pictures need to be moderated.

Apologies for this and hope you understand. I'm sure it will be up and running when the crisis is over.

This is currently disabled for the time being, As Xbox Live is experiencing high traffic & load on to the servers.

As well as saving bandwidth for the high priority services, as lots of people are forced to work from home at this time.

Hope this helps.