Almost no new games for it in a market that is completely saturated with iOS, smartphones, and tablets.
Those sales are great. People need to stop comparing it to previous generations of handhelds because it's a totally different marketplace now.
A) The market was saturated with iOS stuff last year
B) The lack of software is Nintendo's fault. Yes, it would have done better with something equivalent to Mario Kart 7, but Nintendo would have known this like a year ago. No clue why they released NSMB2 in August and let half of their holiday slate slide into 2013.