I think in hindsight it did pay off but really it was about achieving the sweet spot which the Switch hit much closer. The Wii U tried to get 3rd parties back on board because the Wii declined in the later half when 1st party games weren't enough and the hardware began to look outdated. Wii U's hardware was a big hindrance though for 2 main reasons:
1. It made developing 1st party games tougher with longer development cycles as they got to grips with HD and modern games
2. It was still significantly weaker than other consoles so 3rd parties didn't bother with porting new gen games
The Switch had a much better sweet spot, however it also benefitted from Nintendo taking the decision to unify the handheld and home consoles development teams allowing them to have way more resources to develop strong 1st party titles that could drive those sales. 3rd parties seeing the success dived in - albeit not on PS or Xbox levels. Going back to the main point, Nintendo's stubbornness in holding onto their philosophy of focusing on 1st party games and IP development gave the Switch a big edge as they delivered AAA games back to back.
With the Switch 2, the challenge will be different. The Switch benefitted from the dying Wii U to focus early on the Switch which I think is the main reason of the Switch 2's delay, as they definitely feel they need to get a strong launch window to support sales early on and bring that momentum, especially with Zelda not being possible for release, which imo was the initial catalyst for the Switch's success. Still we are going to get a 3D Mario and new Mario Kart in the first year + I would assume Metroid Prime 4 as the more "mature" game all for launch which should set it up nicely.
What is clear though is that I think this will be the most 3rd party friendly console for Nintendo since possibly the SNES days. Apart from games like GTA6 we will probably see a lot more titles across all platforms with much closer visuals and performance than Nintendo has had for a while.







