I mean they have invested a ton into their kid-friendly mode and there have been quite a number of “adpocalips” where ad revenue for many content creators was dramatically slashed due to YouTube’s over-zealous moderation.

It is a serious business concern, there are occasional panics triggered by consumers complaining that a brand ad is shown next to and benefits from the attention of some distasteful content, and they start to bleed important advertisers on mass. YouTube then proceeds to get defensive and demonetizes (removes all ads from) or tags as adult-only any video that may be concerning, where avoiding false negatives takes much more precedence over avoiding false positives.

Of course this is not directly tied to protecting children, but this incentive structure is partly aligned and it is a strong one.