Now is Nintendo's opportunity to release a powerful home console for a very low price. An RTX 4050 console for $250 (like a newer Series S). Release a new Switch at the same time so you can play portable and at home. Get 200 million console sales of the two products together.
If they even bothered to do that, they would need to share a library. After the SNES, Nintendo's only home console that matched or exceeded sales expectations was the Wii.
Nintendo has made plenty of risky or foolish decisions in the past, and making another home console would be one of those. And I highly doubt 200 million would happen, whether two SKUs at launch or two separate platforms.
Switch probably won't sell above 160 million, and it might not even hit 150 million or above. The Switch successor, whether hybrid or with a home console option, will probably not sell above 115 million. There's a good chance it stops at 100 million or a little under.
And if Nintendo outright abandons the hybrid out of the box model, I see this happening.
Next home console: 34-38 million
Next handheld: 68-72 million
Lifetime Sales Predictions
Switch: 144 million (was 73, then 96, then 113 million, then 125 million)
PS5: 105 million Xbox Series S/X: 60 million
PS4: 120 mil (was 100 then 130 million, then 122 million) Xbox One: 51 mil (was 50 then 55 mil)
3DS: 75.5 mil (was 73, then 77 million)
"Let go your earthly tether, enter the void, empty and become wind." - Guru Laghima