The Kursk offensive doesn't change the fundamental situation along the main front but it's really embarrassing for Russia to get its nose bloodied like this, especially as the image of Ukraine as a bloodied nation on its last legs was really starting to sink in. Politically this will have given western support for Ukraine a shot in the arm which is the opposite of what Russia needs if it wants to end the war sooner rather than later. Domestically it's a major setback for the United Russia govt which erodes confidence they had won back after the disastrous first months of the war.
Really just feels like this war is going nowhere fast.
Losing unambiguously Russian territory and having the enemy's flag raised over your villages and towns is totally humiliating for the Russian military and state, when the goal of this war is to demilitarise Ukraine and make Russians safer from Ukrainian nationalist extremism. Two years in and this is still possible - shows that they haven't managed to achieve their war aims yet. You can deny this if you want and act like I'm being a WaPo journalist about it if you want but this will make Russians living near the border feel a lot less like their government can protect them and it makes the Russian victory feel less inevitable.
They dealt with the previous incursions really quickly and effectively, too, so why not this one?