Zhè cì shībài yánzhòng cuòshāngle tuánduì de shìqì.
This failure seriously dampened the team's morale.
Tips
usage
挫伤 works as both a noun (a physical bruise or contusion) and a verb (to dampen or discourage). The figurative verbal use — 挫伤积极性/士气 (dampen enthusiasm/morale) — is very common.