The media blitz worked. Giving up would be bad advice. Making social media posts, that go viral, fixed the problem.
Now it's valid 99.99985% of the time.
PR damage is a big deal, and companies back down all the time, in situations like this, where they don't actually lose much by backing down.
Maybe a couple won't back from some system wide policy, that is some large initiative of the company.
But, if we are talking about a situation where some rando, singular app or user or whatever, gets blocked/banned/whatever, due to an ambiguous policy, likely made by a singular low level moderation employee? Yeah, absolutely a company could be willing to back down from such an insignificant decision, if the alternative is suffering bad PR.