XMPP had rather bad name. Well-known design issues causing message losses, fractioned ecosystem due to varying implementation of extensions, unsuitability for mobile clients, absence of synchronization between clients, absence of end-to-end encryption. Most of these issues were (much) later fixed by extensions, but Matrix (or Signal for those who do not require federated one) was already there, offering E2EE by default.

Even today, E2EE in XMPP is rather inconvenient compared to Matrix due to absence of chain-of-trust in key management.