Apple less than half a year ago made a big pitch for the smart home in the live event where the HomePod mini was launched, speakers that have only just come into general availability after being sold out well into this year. They aren't retreating from this space at all but adjusting their strategy to volume and now they have a volume seller in the form of the mini.
The existing HomePod is simply too close to the mini in it's offering to justify updating in its current form which is why they've pulled it, the mini will have taken a large chunk out of sales. Any future large speaker will have to offer something to clearly differentiate it such as stereo sound.
I also don't believe the HomePod has been a failure at all, it's just Apple has changed their approach to the smart home and it no longer clearly fits into this vision. It was never a speaker you would buy for every room.
The Apple TV is due an update and it's delay may be due to this change in strategy with Apple now wanting an more affordable device that will sell in volume, one for every screen in the house, rather than just one in the living room. I fully expect a new Apple TV to come this year.