Xenomorphs are bio-weapons or at least that what is heavily suggested if not outright believed but I don't think they are used for terraforming, at least not directly. I think they are a mop up weapon, used to clean planets maybe.
People seem to think that Xenos are the latest and most perfect bio-weapon, I disagree, I think the black goo is the latest. Namely because it actually does terraform while also dealing with the local population and has more applications though it is clearly unstable, in the latest comic book like life and death, it is still the weapon of choice used by the Engineers.
I doubt that Covenant and it sequels are about the creation of Xenos because other than the fact the chestbursted SJ in Alien was dead for centuries before the events of Prometheus and thus predates David's experiments, the actual creature in it looks like a bland version of the Xeno.
Some think it is a proto-xenomorph, I personally think it is the opposite, a reverse-engineered/replicated version of something that already exists.