Google is fixing the issue and will restore the label after the problem is resolved.
Google has confirmed that they have temporarily disabled the ‘not mobile-friendly’ label in the mobile search results due to a bug. John Mueller of Google said that Google has turned “the label off for now” but it “should be ok soon.”
This is in response to Google mislabeling pages as not mobile-friendly over the past 24- hours in the mobile search results. Even AMP pages were labeled as not being mobile-friendly. John Mueller said that “this is a bug on our side” and Google is working on fixing it.
Here is a screen shot of Google labeling an AMP page as not mobile-friendly:
Here is a screen shot of an AT&T page being marked as not mobile friendly:
But the Google mobile friendly testing tool showed it at the same time as being mobile friendly:
So this is clearly a bug, Google said it is an issue on their end, and for now, they have turned off the label from displaying in the search results until Google fixes the issue.
Source -: Search Engine Land