nintendo as a first party developer, pays no royalties, sets the rules, and earns royalties from third-party developers. the 3ds is experiencing a pretty normal decline for a decently normal system. it will be five years old at the end of this fiscal year. that by itself doesn't really scream the end of nintendo's time as a hardware manufacturer. the wii u is, unlike the 3ds, a collection of problems that nintendo themselves created for some reason. i think replicating the kinds of boneheaded moves that led to the wii u being what it was would actually take a degree of effort.
neither one of the wii u or 3ds signal that nintendo needs to get out of the hardware business. however, they do signal that nintendo should probably adapt to the new video game market, one that is becoming less and less reliant on the model of needing dedicated boxes that hook up to a tv for video games. they can also learn from the mistakes of the 3ds and wii u. two big ones are nintendo's lineup gaps and the increased focus of the online marketplace. imagine their next platform isn't a console, but rather a digital system, more like steam, that can be used across multiple hardware devices. nx would effectively be their handheld and their console. in the short-term, it lets them make consoles and handhelds. in the long-term, it sets up nintendo the platform-holder in the digital space, for when dedicated hardware is meant for hobbyists and enthusiasts. working this way, they wouldn't need to develop two mario karts a generation or four mario platformers a generation. instead of creating fatigue and disinterest within their own fanbase, they can reach into their past catalog and come out with new takes on old games, or have teams work on new ideas more frequently.
this kind of freedom doesn't happen if they don't have their own platform to work on. without a dedicated gaming platform that nintendo makes, nintendo doesn't earn money on royalties from third-parties. it means they don't as big a cut on software. it means they have to learn new hardware. killing 55% of the revenue they take in means they don't get enough money to spend on the 500 million dollars they pour into research and development on a yearly basis, software that never leaves development, and games that do after enough time to polish them to an acceptable level.