Basically the company is "losing" money every time someone claims the promotion because they are giving their service away for free.

Normally, companies will have a good estimate on how many people will make use of the promotion and how much money they will "lose", but sometimes the reality exceeds expectations and so they put a cap on tbe number of times a promotion can be claimed so as to not get exploited too much.

Btw I say "lose" in quotes because it may not be an actual loss of money but a loss of potential earnings from a customer. Also, don't worry about the downvotes, I've seen many innocuous comments also get a few downvotes for no reason.