The market wasn't, and still isn't, ready for a super high quality and expensive handheld. Vita was $250 at launch ($290 with inflation adjustment). And that was just for the device. It had no ability to plug into a TV and didn't come with a dock. So for about the price of a Switch now it simply came with a portable device, no TV mode, no detachable controllers with motion tech or pulse detector for fitness games or HD rumble. That's a lot of money for so very little other than shiny graphics.
If the Switch 2 came out as some friggin monster beast of a hybrid and cost $500 it would bomb harder than GME. Nintendo knows not to make the mistake of Vita thankfully. They will not shove an RTX380 Super into a handheld.