Microsoft hides file extensions in Windows by default even though it’s a security risk that is commonly abused by phishing emails and malware distributors to trick people into opening malicious files. A file extension is the letters immediately shown after the last period in a file name and is used by the operating system to determine what program is used to open, view, and utilize the file. By default, Microsoft decides to hide file extensions so that a file named’report.txt’ is simply shown in File Explorer as’report’. The original reason for this was probably to make it less confusing to users.
Source: https://www.bleepingcomputer.com/news/microsoft/hiding-windows-file-extensions-is-a-security-risk-enable-now/