It is a euphemistic term for a baby born dead.
Perhaps a little gentler for the poor mother.
The baby may have died some time before birth, the mother would not feel any movement but that can be normal near the end of pregnancy when the baby’s head is engaged ready for the birth.
Sometimes they die during the labour especially if the placenta detaches
as then the baby has no blood supply of its own, that does not happen until the baby takes its first breath and its own circulation starts independent of the mother’s .
It is a magical moment , that first breath.
Many causes and in days gone by without scans and blood tests etc things picked up on nowadays were not realised.
Viktoria.