The film was a success at the box office
It was not. Saying so is revisionist history. It made $267 million worldwide, on a $105 million budget, not including marketing (less than
Brother Bear when adjusting for inflation).
Alvin and the Chipmunks: The Squeakquel made $443 million that same holiday season.
Enchanted two years earlier made $340 million worldwide on an $85 million budget. Disney likely felt that a REAL animated princess movie (not just live-action with 15 minutes of animation) from the directors of
Little Mermaid and
Aladdin, would do even better, but it didn't.
Disney panicked and decided not to move forward with another hand drawn feature.
Pooh was already in development, being released about 18 months later. It was also the reason why
Rapunzel, due to be released the following year, was renamed to
Tangled in North America
. It was feared that the word princess in the title would again put off boys (whether or not that was the real reason it underperformed, we'll never know).
The movie was, and still is, however able to do well in merch sales on the back of the Disney Princess brand, Tiana benefiting from being its only black character.