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CosmicSex said:

There are many different reasons why the PS5 could have sold more. But I wonder if it has anything to do with the mature content of the game and Nintendo still being seen as the family friendly option (regardless of reality).

Considering Japan is the country infamous for excess of porn media in animes and games? As well as small number of kids and teenagers compared to middle aged people? Hardly any correlation I fear 

My opinion is Japanese people wants games that can be played well on handheld form, i.e. less information on screen, low skill and reaction times required (due to limitations on control schema when playing handhelds), less cinematic, good to be played in small and short sessions with lots of pauses

And of course, there is a change in how Japan produced media. During the 70s, 80s and the 90s there was still effort to create media that resemble western art, we could see this in mangas and games alike. We can see many of games emerging in the 80s influenced by western media culture: RPGs, science fiction, high fantasy, Super Hero comics, etc

Just compare how The Legend of Galactic Heroes anime looked like in the 80s and how its remake looks in the 10s

Gaming industry in Japan just followed suit, really. Then the issue is what to do with IPs that tradionally followed a more "mature" and western art style, which no longer belongs to the cultural zeitgeist. Can you imagine Metal Gear Solid or Final Fantasy having Moe aethetics?

At start the loyal fandom was still there (PSP-PS3 era), but once you start aging and caring less about games it's over, the only path is downwards 

No, Switch 2 is not going to save those IPs. Only a new cultural shift + changes in how people approaching games (less handheld, more stationary) could do that. Neither seems to be happening anytime soon