Resizing on the fly. Think of an API that gets an image and desired resolution and sends it. It's a common enough use case. Compare Lambda as the entry point of this API compared to another framework.
Any other webserver is simply get image off S3->Resize it->Send raw binary data to the user (and optionally cache the resized image if you think it'll be requested in that size again).
The Lambda flow is as follows. Get image off S3->Resize it->upload to S3 and then redirect the user to that image via a cloudfront URL.
Unnecessary steps caused by the inability of Lambda get binary data out through the API Gateway. Particularly from the users point of view. You double the number of requests they have to make to fetch images.