The PS3 is a hundred times more successful system than the N64 and the Gamecube combined, even though it was barely profitable - everything depends on your point of view. The PS3 was and continues to be a mainstream console wheras both the N64 and the Gamecube were on the margins of the industry throughout their life cycles. If you define success by means of profitability then sure, by all means, you're right, except that's not the only factor we take under consideration.
EDIT: To elaborate on that point, I'm all happy-clappy-chappy that Nintendo was continuously posting profits and was able to support their software development houses. What I'm not happy with is that they did so by releasing poorly engineered, underperforming and/or underpowered hardware. While both the N64 and the Gamecube were relevant from a hardware standpoint and just poorly designed, the Wii and the DS don't have any excuses for being outdated Day 1, and neither does the Wii U and the 3DS.
Nintendo's profitability has zero impact on my gaming experience. What matters to me is whether or not the company's systems are up to par and whether or not they can deliver the processing power necessary to meet the requirements of the gaming generation they're released in, it's that and that only that's under fire here. There's nothing wrong with designing a system that meets industry requirements, even if it has to be sold at a loss as long as those losses can be counter-balanced with licensing profits. The PS3 is an extreme case where the losses taken were unsustainable, the PS2 on the other hand was a completely different and highly profitable story.