It seems pretty clear cut to me. The bullet's right in front of him. He's surprised that it's trying to penetrate his shield.
It's about a quarter inch or less from him. If he moves, the shield will break and he'll get hit. But he stays in place believing his shield will hold but the bullet makes its way through anyway.
And yeah, someone could say "But no, he would've done this, this and this and been totally fine!" But one could apply that way of same way of thinking to literally any character they have a fondness for and rationalize the notion that they could overcome any attack.
Sometimes a character just goes down. Maybe there's going to be more to this and Mandarin isn't really dead but I'm gonna say he's toast.
If you're going to kill a big villain, Mandarin is a good one to go with. He's a real name but yet he's not a character that anyone wants to use as much these days.