It was retired because all the Armed Services are only given a limited amount of funding by Congress each year, which has to be used to pay for either newer, more expensive to maintain platforms, or older, expensive to maintain platforms. The S-3 was at the bottom of the funding ladder and was thus easy for the Navy to let go.
From its entry into the Fleet, the S-3 never had enough spare parts. Every end of cruise saw the returning squadron forced to trade fully mission capable aircraft to the next squadron in line to deploy, or robbing parts from those full mission capable aircraft, for the other squadron’s hangar queens.