Unfortunately, they couldn't maintain their momentum and had to get out of the business of making phones. (They still make their mobile OS, and you can buy a license for it and install it on some Sony phones).
At that time, Apple even had an ad-network for apps, and had got embroiled in the PRISM scandal (Apple, and other American corporate were selling their users data to US government agencies - https://www.theguardian.com/world/2013/jun/06/us-tech-giants... ).
Jolla was marketed with a focus on privacy.
To counter the bad publicity and the threat from a potential startup, they partly shut-down their ad-network ( https://appleinsider.com/articles/16/01/15/apple-to-shut-dow... ) and started marketing their new found love for privacy.
But from the get-go, it was never about user privacy - their goal was to ensure that the users data remained siloed within their eco-system, and their competitors couldn't get access to it. They also used the "privacy" angel as an excuse to further close down their devices, and make it incompatible with anything not approved by them.
(Note that it was due to their ad-network and because Apple wants access to users data that iPhones / iPad don't give you the ability to control what app can or cannot connect to the internet. This is still the case, except if you are on cellular data; if you are on Wifi though, an app cannot be blocked. While all the new labeling "transparency" feature and telling the user what data an app will gather from you is good, the feature that would really benefit every one better is the ability to block apps from connecting to the internet itself in the first place!).
It's a natural outgrowth of a corporate "efficiency" mandate that puts functional groups together vs. cross-functional groups. That pendulum is ever swinging.
They never claimed to be the 'privacy king'. They just suggested it, and people took the bait.
Apple is a company, and as such are only allowed to care about their bottom line. If privacy aligns with their bottom line, they'll use it for easy advertisement and goodwill, but if it doesn't then they'll forego privacy just as easily.
That's a myth. It is neither descriptively the case, nor normatively an obligation, that a company maximise profits to the detriment of everything else. There is no such law, legal or economic. (There is shareholder value theory in economics which suggests that shareholder value maximisation is the optimal solution to the principal-agent problem, but that rests on very restrictive and utterly unrealistic conditions. Furthermore, shareholder value optimisation is not the same as short-term profit maximisation, either.)
And who says that profit maximization necessarily has to be "short-term"? Clearly, marketing themselves on strong privacy guarantees is a long-term strategy.