1 To prevent stalking
Some people hide their friend lists to prevent others from stalking their friends through them. Those people don't want others to search their friend list then keep adding people while talking the advantage of the fact that they have someone in common.
2 They have trust issues
People who have trust issues usually hide everything they can hide in a Facebook profile or a social network. Because the option to hide the friends list is there, those people feel more comfortable hiding it.
3 To hide friend's count
Some people don't feel like showing the number of friends they have on Facebook. Those people might hide their friends' list in order to not show the number of friends they have. See also why some people update their status very often.
4 To protect close ones
Some people hide their friends' list in order to protect close ones who might try to find them, harass them or annoy them in any way.
5 They have paranoia
Some people are very paranoid. Those people always think that others can use their information in order to hurt them. Those people usually hide everything that they can hide.
6 They don't want to be stalked
Some people don't want to let others know who they are friends with. Those people might want to keep their lives private and so they might want to hide their private details from others in order not to get stalked.
7 They are ashamed of some friends
Some people feel ashamed of some of the friends they have. Those people might hide their whole friends' list to keep those friends hidden. See also why Facebook is so negative.
8 Not to introduce wrong people to their friends
Some people have the hobby of searching the friend lists of others then adding people randomly. In such a case, the common friend is usually the one who gets the blame if something went wrong.
9 To hide their social activity
Some people don't want others to know who they are talking to or who they hang out with. In order to keep their social activity private, those people might hide their friends' list.
10 It's a spam account
People who create fake and spam accounts usually hide their friend lists in order not to tell others about their activities. See why do spammers spam.