Hi everyone,
Please STOP uninstalling your games, clearing credentials, or wiping your PCs!
Based on all the reports coming in here simultaneously, and the fact that standard troubleshooting (and even full system restores prior to the Windows updates, as Luciano mentioned) is not working, this is 100% an Xbox Live backend server outage / authentication issue.
The error code 0x87DD0005 translates to an Xbox Live service connection issue. The recent Windows updates appear to be just a coincidence in timing. When an outage like this happens, the browser sign-in often still works (because it uses standard Microsoft account web cookies), but the actual Xbox Live API that the desktop games rely on fails to authenticate.
There is no local fix for this on your PC.
We simply have to wait for Microsoft to acknowledge the outage and fix their authentication servers. You can keep an eye on the official Xbox Status page ([support.xbox.com/xbox-live-status](https://support.xbox.com/xbox-live-status)) to see when they officially report the service disruption. Save your time and do not reinstall massive games or reset your Windows installations!