No surprise as even centralized exchange usage drops when in bear markets; that, and add the fact that using online exchanges are far more convenient and overall better(probably besides privacy in some cases) than ATMs.

Could it be re -withdrawn because they decided to put new updates or for any technical reasons and not necessarily be political, financial or organizational?
I did not used any bitcoin ATM, but I do not see it as an indication of increasing the alert or increasing/decreasing the proportion of bitcoin acceptance and so on.

Regulations seems the big problem for Bitcoin ATM, even in my country many startup companies tried to do business with the installation of Bitcoin ATM but every attempt ended as a failure because the government and central bank doesn't really draw a line in most countries about installing of currency machine for public should be issued by which authority.

No worries … Spain has added 3000 ATMs this September where you can acquire bitcoin from, and they’re not even on CoinATMRadar yet … nor should they … they really allow you to purchase a coupon at Euronet ATMs, which you can then redeem through Bitnovo’s website. A two phase purchase as such should not count as bitcoin ATMs, so the said 3K ATMs won’t come to the rescue.

On a serious note, it’s essentially impossible to determine why the net amount of bitcoin ATMs dropped by 796 units during September, as the data on CoinATM Radar does not drill-down into the information. Likely it is essentially based in the US, where the net amount decreased by 835 bitcoin ATMs.

The best one can do is try to compare the current operators with those from a recent snapshot (11/08/2022). It gives some potential high-level insights, but nothing conclusive:

Currently:

On the 11/08/2022:
That means that the top 10 operators have lost 905 ATMs in just under 2 months. Comparing the numbers for the top 10 operators, it seems that Bitcoin Depot went from 6.898 ATMs to 6.420, Coincloud went from 5.520 to 5.162, bearing most of the luggage. There are no further details, so one cannot tell why this has happened, if some of those have been replace by other ATMs from another operator, or anything of the sort. In fact, being the figure that of an overall net amount, one could make wrong assumptions by looking at a small sample of the data as I have done above.

But as per the book of laws the central banks are individual authority not really possessed by the government just like the court of the country so the banks can certainly crumble the start-up companies by taking legal actions against them since every company needs the help of banks so they don't go to extreme situation to fight for it.

Could the drastic drop also as a result of the bear period? Between, in a normal circumstance how many people are actually using these ATMs to buy or withdraw on a daily basis? If the % is as high as what I read above, I don't think anyone will be eager to make use of btc atm to buy. That's a complete ripoff.

Normal behavior as demand is low. In short, it's just the law of supply and demand at work. The market is down, with a great tendency to return to the levels of years ago.

Not an unexpected situation if you ask me. Bear markets are a time of much lower trading activity with smart investors buying (but not through ATMs), those who feel like they're at a loss crawling into their shells for winter because they feel like they got cheated by the market and holders keep holding.

ATMs are what becomes popular in bull markets when holders take some profit and newbie investors are so hyped up that they don't care about ATM fees, they just want to get some coins ASAP.

No worries though, a halving is just a little over year before us. We've been a year into the bear market and there's probably a few months of accumulation before us.

I would say that mainly those who try to avoid KYC buy in this way, but also those who have not yet found out that there is a much cheaper alternative, whether it is CEX or DEX.  As you yourself say, the price of such a device, along with all the costs arising from maintenance, insurance, and paying taxes, does not give the owners too much room to lower fees and be competitive with other players on the cryptocurrency market.

However, the number of such devices is constantly increasing, and regardless of the current situation, I think that it will continue, perhaps even at an accelerated pace, considering that more and more people are learning about Bitcoin and want to buy it in one way or another.