Nintendo's own hardware designers have said they weren't satisfied with the Switch 1 (Tegra X1) chip's performance but for the time (likely meaning the cost/availability) it was the best option for the Switch 1 circa 2015 or whenever they would have had to have made th decision on which chip to use. They wanted a better performance chip.
They are happier with the performance of the Switch 2 chip which was no doubt designed with their involvement this time. This is straight from Nintendo's own Iwata Asks style interview with the Switch 2 hardware team.
Nvidia is simply a far bigger and more seasoned company at making these kinds of mobile chips too. The Tegra K1 and X1 were early days efforts, the chip that is in the Switch 2 (T239) is by now several generations ahead. Likely Nvidia has simply gotten better at making these kinds of chips (any chip really). The fact is Nvidia has simply grown to become one of the largest market cap companies on planet earth now.
A company like Sony is a tiny little fart compared to Nvidia these days, ditto for AMD. Nvidia has the best engineers and monstrous R&D resources available to them these days versus 10 years ago when they were no where close to the same market cap. That likely did not hurt the kind of chip Nintendo got these days, Nvidia is now the Rolls Royce of tech companies, they have massive R&D and capex spend and can outbid competitors for top end engineering talent. The Nvidia we are talking about today isn't the same little company they were 10 years ago.
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