Why does that character have to die?

Question

In Blade Runner 2049:

Why does Wallace kill that newborn replicant in the birthing room?

I can see only three possibilities, none of which is satisfying:

1. It's just needless exposition, to let the audience know that he's evil. This is the likeliest explanation that I can think of, but if true it greatly lowers my opinion of the movie.
2. He's so frustrated by the replicants' sterility that he kills her out of rage. Unlikely if she was originally made for a client; that would be bad for business.
3. He's a sadist, and some of the replicants are produced for his pleasure. Plausible, but in the absence of textual evidence there's no reason to think it's correct.

Answer 1

Wallace killed the Replicant because she was a failure.

It's all to do with the context; Niander Wallace was talking about reproductive Replicants and this new one was a failure, so he simply 'retired' her. He's got a 'god complex'.

The birthing room

^{img src}

It looks like this birthing room within his quarters was a bit out of the ordinary, why would he have that happen there? If there a literally millions of Replicants as he himself claims:

[Deckard]:You don't have children.
[Wallace]: Millions.
_{-Paraphrased from memory}

It would be extremely inefficient to 'make' them, one at a time, in his private birthing suite.

The failed experiment
This tells me that the newly 'made' Replicant was Wallace's failed attempt at creating a Replicant who could reproduce.

In fact, he seems well aware of the fact that Eldon Tyrell had the means of creating reproductive Replicants. He seemed to have been trying to emulate the process.

Garbage collection
Wallace's reaction is to 'retire' the failed experiment, and in his frustration, he does it himself. It's unclear whether this is a normal practice for him, but he is definitely visibly perturbed.

Did you catch where he stabbed the Replicant? He did it in the spot where a female's reproductive organs would be. That's the key, he's gone immediately toward this newly 'made' Replicant, has a monologue about reproduction and how he can traverse the Galaxy and 'conquer the stars' (presumably with generation ships), then when he sees that it's failed, he kills her.