I didn't expect the *entire* casual audience to abandon Nintendo, I thought they'd be able to hold at least a minority portion of them, but smartphones/tablets have really completely eaten that audience alive.
1/3 of smartphone owners apparently play games on a regular basis every week, that means you're talking about an audience of about 150+ million ... likely a lot of those people playing Candy Crush on phones today were playing Wii Sports maybe 7-8 years prior.