It looks like it unexpectedly rebooted prior to the demo as the message on the screen was something like "You must enter your passcode before using Face ID".

Something similar comes up on reboot for touch ID users. You have to enter your passcode once on startup to decrypt the storage where the fingerprint data is stored.

Should be pretty easy to find out in a replay or screenshot. If it was indeed after restart it’s not failed but a deliberate design decision.