The storm was mainly weakened by wind shear.
Here are some key points:
Wind shear is defined as the change in wind speed, wind direction, or both, over some distance.
Hurricanes thrive in environments where their vertical structure is as symmetrical as possible. The more symmetrical the hurricane is, the faster the storm can rotate, like a skater pulling in her arms to spin.
Too much vertical wind shear, however, can offset the top of the storm. This weakens the wind circulation, as well as the transport of heat and moisture needed to fuel the storm. The result can tear a hurricane apart.
Source: What is Wind Shear, and How Does it Shape Hurricanes
As to the destruction being less than the worst-case scenario predicted, that’s because the storm ended up making landfall south of Tampa Bay:
Tampa Bay remained in the hurricane’s northern eyewall, which meant that winds blew from the east—offshore—during the worst of the storm. Not only did these offshore winds spare the region the worst of the surge, but Tampa actually experienced an “anti-surge” as the storm made landfall. Strong winds pushed more than a metre of water out of Tampa Bay and into the Gulf of Mexico.
Source: How Hurricane Milton’s Destructive Surge Mostly Spared Tampa Bay
This is exactly what spurs me to wash my dishes right after using them. It’s much less stressful to clean a single plate & fork now, than to return to a sink full of dirty dishes later. I’d rather just get it over with while it’s still easy to do.