You're kinda beating around the bush and your arguments aren't reaaly making sense.

I know what being relevant means and I know what niche means but how can we say Nintendo is less relevant and more niche if their individual IP sell better? What determines whether Nintendo is relevant or not, the success of their hardware or the success of their software? Considering that the main point of selling hardware is to provide an ecosystem for their software to thrive on than I would say software is more important when discussing the relevance of Nintendo.

You say that software could increase because of not splitting their bases anymore but the opposite could be true for hardware. A drop from 80 million to 70 million could be explained by people not having to buy two seperate devices anymore or not as many people buying multiple revisions.

Would Nintendo be declining in relevance if they see a 15% decline in hardware sales but most of their franchises see a 15% increase? I guess it depends on perspective.

Ya if Switch hardware has a slight decline from 3DS+Wii U sales but their software sales increase along with having successful movies, theme park attractions, mobile software and they start posting annual profits higher than the 3DS/Wii U era than it would be very strange to say they're declining in relevance.

If it could hold or only be slightly down from the 3DS that would be a success.

Expecting literal 3DS + Wii U sales doesn't make sense, because that isn't an actual audience. Lets be realistic, at least half (probably more) of Wii U owners have a 3DS too, so that leaves you with 7 million Wii U distinct owners at best, and not all of those people are coming back, not after the way the system tanked.

So there's probably in actuality like 3-5 million Wii U owners in play for Nintendo, not 14 million on top of the 3DS number.

Also it's simply harder to sell portable hardware these days (and hardware in general). You say if I walked 500km, that's a decline from 650km I walked the year prior, but if I was doing that walking uphill instead on a flat road, that makes a big difference.

With more and more cheapo tablets available this gen and more marketing for smartphone apps, it's harder to sell the same. The 3DS at least had a year or two where tablet were generally too expensive for kids and smartphone games didn't have more marketing than console games even. But today that isn't the case, Switch has tougher competetion than the 3DS did. 

Well that's also assuming that there will not be Switch owners who didn't own a 3DS or Wii U.

It might be a difficult task but it is possible that the number of non-3DS/Wii U owning Switch owners can potentially offset the number of people who own a 3DS & Wii U.

It's possible but they will need I think a new franchise hit to break out for that to happen. These types of things don't happen with a new franchise becoming a big player to drive hardware sales (see: Pokemon on Game Boy, Wii Sports on Wii, Halo on XBox, etc.). 

I'm just saying the idea of 3DS + Wii U being an actual tangiable audience is a false premise. There's probably only a handful of actual Wii U only owners, as the people willing to buy the Wii U are likely Nintendo's most ardent fans and as such they almost certainly have a 3DS as well in many cases. 

If Nintendo can sell even 90% of the 3DS marketshare + lets throw in 4-5 million for Wii U owners .... that would be a success IMO. You can't compare last gen to this coming gen without accounting for the dramatic difference in tablet/smartphone adoption and influence amongst kids. 

If Switch can sell the same as the 3DS that would be a victory because Nintendo will likely have to work harder to get that. Like I said it's like walking on an incline versus walking on a flat road. 

Well yeah having a huge hit new IP would certainly make that an easier task but its not 100% needed in order to get new people to buy Switch. There are many potential reasons why somebody may buy a Switch that didnt own a 3DS or Wii U.

But yes you are right that the actual number of 3DS+Wii U sales are not the same as the number of individual people who own a 3DS/Wii U.

Disney has had their relevance decline in video games,even though they are the epitome of relevance culturally. What you're describing is similar, and it would not be good for them. Nintendo is not simply a software company, but a hardware company. That is integral to their identity and their bottom line, and having that decline more than the abysmal levels it is at currently would be very bad for them, regardless of a minor boost in software sales. All of that other stuff is supplementary to their dedicated gaming business, and selling hardware is the structural foundation of that gaming business. That cannot be overstated.

35 mil

My other posts dont take their other business ventures into consideration, read those if you haven't already.

Not really, because while they may make money on each individual unit, a certain amount has to be sold to make up for the R&D costs.