The official reason was, famously and ridiculously, "courage". Apple further explained that space is at a premium, listed the many things competing for that space, and noted that a large, single-purpose legacy connector no longer made sense.

A lot of Apple's strategic choices are driven by products that take 5, 10, or sometimes 20 years to realize. For example, the forthcoming foldable iPhone (and the proving ground for many related decisions, the iPhone Air) was on roadmaps literally a decade before a decision like this reverberates through released products.

Putting a high-quality DAC in a dongle wasn't a terrible solution (many phones with analog jacks have poor ones), and today hundreds of headphones¹ courageously have native USB-C support.

¹ https://www.bhphotovideo.com/c/products/usb-c-headphones/ci/...