That's interesting, because Nintendo was systematically pushed out of the home console market since the N64. The Switch is just their handheld market plus 10M from their remaining Home Console audience. In this process, what?10-15 years; Nintendo has lost a lot of Third Party Support. In other words, Nintendo's first-party titles are the lifeblood of Nintendo's business. between 60%-80% of software sales revenue comes from First party while 30%-40% for Play Station.
So, (and I think this is the main issue with PlayStation). Nintendo just announced that they are exploring ways to make games
faster/cheaper.
Nintendo president Shuntaro Furukawa spoke of ways to deal with the rising cost of Nintendo Switch 2 games.
www.yahoo.com
I don't think Nintendo games cost $300+ million to develop and market. Meanwhile, PlayStation keeps pushing graphical diminishing returns with stale gameplay. They are being financially forced to put their games on other platforms, but the real issue is the need to create more interesting and fresh games.
So, as of now, Nintendo primarily relies on their first-party games to market their platform and drive its storefront. But if we assume that over the next 10–15 years, Nintendo nurtures a stronger and healthier third-party ecosystem, things will remain the same.