I think there's still a place for handhelds, and if they're doing okay during the huge boom of mobile gaming, I can see them doing okay once mobile gaming stabilizes. But yes, Western developers have never been interested in handhelds so they're okay making $1 games that are nothing like the main titles, while Japan puts main entries of their series on handhelds like with Dragon Quest and Shin Megami Tensei.
Handhelds will be fine if they can keep GBA-like numbers, I think.