Define production. Docker compose is fine for running a small internal service in production for dozens of users (i.e. not for developing said service, but for using it). I would assume it isn't fine to run a hyperscaler (but I wouldn't know). Those are extremes, and there are going to be a ton of situations in between.

I can't personally speak to what the limit of docker compose is, as I have only worked on the lower end of this: self hosting for personal use and for small internal services serving maybe 20 users.