So far the number of software titles released on Switch has increased every year, and I think that is going to happen again this year.  So, I agree with what you are saying.  I want Switch to have more third party games, and it seems like they are coming.  For Japan, in particular, Switch is really now the only viable platform, so I think most development teams are in the process to converting to making only Switch games.  That takes a few years for that to happen though.

I'm not sure if that is really true. Most of the big japanese publishers have been very reticent to release their titles on the Switch, and it's been years now. Level 5, Atlus and Capcom supported the 3DS way more, Sega has mostly focused on Sonic and older ports, Konami is a no show because Konami... The ones that've been the most consistent has been SE and Spike Chunsoft, and with all of the SE buyout rumours, I'm not sure how long that is going to last.

Konami is not a no show. All of their games have been releasing on the Switch the past few years, often as exclusives. Momotaro, Yu-Gi-Oh Rush Duel and Master Duel, their Baseball Games etc. They haven't been a no show. That's why they're more profitable than ever now.

Koei Tecmo has been very consistent too btw.

Oh yeah, I completely forgot about the Momotaro Dentetsu game.

The number of new releases continues to increase each year in Japan.  (In the table below 2017 means the FY ended March 2017.)

Here is why I think it will continue to increase.  It seems to take a Japanese development team about 4 years to develop an original title for the Switch.  For the first couple of years Switch didn't get great third party support compared to the 3DS (although it was pretty good compared to the Wii U).  I think most third party publishers held back because Switch was a new concept, so the first couple of years were slow to get new titles and even when they did it was mostly a port of an older game.  (Ports can be developed quicker than original titles.)  Then in 2021 we got titles like Monster Hunter Rise, Bravely Default 2 and Rune Factory 5.  These are sequels to 3DS games.  They were always coming to Switch, but they didn't get greenlit until 2017 when it was obvious that Switch wouldn't be a total dud.  This year we got Triangle Strategy which is 4 years after Octopath Traveler.  For an original Japanese third party game, you have to figure there will be a four year delay between the project being greenlit and its actual release.

This year Switch's new third party games will be based on how people saw the Switch performing in 2018.  It was selling decently well in Japan, but it was significantly behind the 3DS launch aligned.  In 2019, it was gaining ground on the 3DS, and in 2020 is when Switch sales really exploded.  That means that 2023 should see an noticeable increase in new Switch third party titles and we'll see an increase again in 2024.  I also expect the number of new titles will increase this year as well, but it will mostly be due to ports.

People have said that Switch lacks good support for a while now, but the data suggests it is already getting good support.  The number of third party titles continues to increase each year, and in Japan the Switch has a monopoly.  Third party developers may appear to be behaving irrationally, but that is because it takes game developers 4 years to react to Switch's sales trajectory.  When you take that into account, the developers actually are behaving rationally, but they are behaving rationally with respect to how the Switch was selling 4 years ago.

Quick update: The Switch has now sold over 25 million units in Japan. According to Famitsu in Week 24, 2022 (6th June - 12th June) it sold 58,436 and now has a lifetime total of 25,010,404 units sold.

Congrats to Switch!

This thread may not get another update for a while though. Gameboy and DS sold close to the same amount and are way ahead of 3DS and PS2. I think Switch will eventually take the top spot, but it will take a while.
DS 33.01
GB 32.47
3DS 24.66
PS2 23.18

At this point it comes down to how big the decline next year is assuming the successor is 2024 at the earliest. If it's small enough to where 2023 is at least about 3m it probably will do it but if it declines enough to where it's closer to 2.5m than 3m it probably won't.

According to Famitsu the Switch has now sold over 26 Million units.

It has a chance of reaching 5mil for this year. Still on course to top the DS.