I did some research and I thought I would share with the community what helped in this issue. The theatre mode was on and turned "Always On" function off. Number 5 did the trick.
"Fix always on display not working on Apple Watch Series 5 (6)
Here’s what to do if you find Always On Display Not Working on Apple Watch. We will also explain the cause of this issue in the first place which will help to stop it from happening in the future.
Try the following fixes if always on display is not working on Apple Watch 5. After each step, please check to see if your problem is fixed.
1. Restart your watch. Restarting may fix this problem. To restart your watch, press and hold the side button until you see the power off slider and then slide the slider. Wait a few seconds for your watch to turn off completely. To turn your watch back on, press and hold the side button until you see the Apple logo.
2. Disable and enable. On your Apple Watch, head over to Settings > Display & Brightness > Always On and turn this off. Wait for about 1 minute. Then again tap Settings > Display & Brightness and turn this on.
3. Update the software on your Apple Watch. Please follow these steps:
If your watch is running Watch OS 6 or higher: On your watch, go to Settings > General > Software Update.
Alternatively, you can update your watch using your iPhone. To do this, Launch the watch app on your iPhone and go to My Watch > General > Software Update.
4. Turn off wrist detection. Several users including our own readers have reported that turning off wrist detection fixed their aod problem. Keep in mind, when this is disabled, you will need to type in your passcode when you want to use Apple Pay. To do this, go to Settings > Passcode, then turn off Wrist Detection.
5. Make sure that Theater Mode is off. When this mode is enabled, your watch screen will stay dark even if you raise your wrist. Please follow these steps:
On your Apple Watch, launch Control Center by swiping up from the bottom of the screen.
Now, tap the Theater Mode button (two theater masks button).
6. Unpair, erase and then repair. To do this, please follow these steps:
Open the Watch app on your iPhone. Go to My Watch tab > and then your watch. Tap the (i) info icon next to the watch that you want to unpair. Then tap the red “Unpair Apple Watch” button. Follow the onscreen prompts. Please note, your paired iPhone will automatically create a backup of your Apple Watch if you hold your watch next to your iPhone.
Now on your watch, head over to Settings > General > Reset > Erase All Content and Settings. This will remove all apps, settings, and data on your watch.
Finally, repair your watch with your iPhone. During this process, you can choose to restore it from a backup.
If the above tips did not solve your issue, your Watch may be having a hardware problem.
Contact Apple.
There you have it! Always on display is working on your Apple Watch again. Next time you have a problem with the “Always on Display” not working on the Apple Watch Series 5n (6), you’ll know exactly how to fix the issue".
Reference "https://geeksmodo.com/apple-watch-always-on-display-not-working-fix/"