The Ending Of The Boys Season 3 Episode 3 Explained

Episode 3 delves further into what happened to Soldier Boy. Soldier Boy, the superhero who massacred MM's family, is the key to taking down Homelander. Since both men have similar powers of invulnerability, Billy Butcher believes that whatever incapacitated Soldier Boy will be capable of killing Homelander. After learning from Gunpowder (Sean Patrick Flanery) that Soldier Boy disappeared during a CIA sanctioned mission in Nicaragua that was led by Grace Mallory (Laila Robbins), the group decides to pay her a visit.

Under duress, Mallory finally admits what happened. In the 1980s, she was stationed in Nicaragua, where the American government hoped to destabilize the Russian-supported Sandinista authority by funneling money and weapons to the rebel Contras (via History). The operation is put in jeopardy when a young Stan Edgar (Justiin Davis) arrives with Soldier Boy and the rest of the Payback team. Edgar explains that the military wants to introduce superheroes into the armed forces, much to Mallory's chagrin. 

However, when the enemy attacks, the Payback team cracks under pressure. Amid the carnage, Mallory is knocked out, and she awakens to discover the camp in ruins. A distraught Crimson Countess (Laurie Holden) informs Mallory that the Russian forces used a special weapon to kill Soldier Boy. They watch in horror as his body is taken away in a helicopter and in the present, Butcher berates Mallory for hiding information that could have stopped Homelander years ago.