I ask this because I’m still unsure why exactly SEGA stopped making consoles.
SEGA made too much hardware, charged too much for it, oversaturated the market, confused their customerbase, and had super shitty direction in North America.
Too much hardware: SEGA Genesis, SEGA CD, SEGA 32X, SEGA Nomad (←those are all just the Genesis,) SEGA Game Gear, SEGA Pico, SEGA Saturn. Those all came out within 7 years.
Charged too much: The SEGA Saturn was $399. That's $750 today. No one was going to pay that for a console that was similar to others that cost way less.
Oversaturated the market: The 32X and the Saturn were both released in 1994. The 32X was an add on for the Genesis that kinda-sorta-almost made it a next gen console. The Saturn was an actual next gen console. As a consumer, how do you know which one to buy? Which is going to have more or better games? Where do you put your money?
Confused their customer base: See above
Shitty direction in North America: SEGA North America told developers and publishers that they couldn't make 2D games for the Saturn. Also, SEGA NA refused to allow publishers to bring RPGs to North America because "they're too Japanese." You know, RPGs like Final Fantasy, which became an absolute juggernaut on Playstation and sold millions and millions of copies all over the world. Not allowed on the Saturn. That's not even getting to the part where SEGA NA pissed off a ton of developers, publishers, and retailers with a surprise early release, catching publishers and developers flat footed with no games ready to print, and giving a TON of sales to a handful of large chains, and fucking over other large chains, regional stores, and local retailers. Retailers said "fuck you right back" and refused to stock the Saturn, locking it out of major portions of the North American market. Oh, and publishers and devs also cancelled a bunch of games, too.
And we haven't even gotten to the fact of the hardware bombs. 32X? Bombed. Nomad? Bombed. Saturn? Bombed. Dreamcast? Bombed. SEGA had such an unfocused plan in the 90s that it didn't matter how great the Dreamcast was, they burned bridges with industry partners, confused consumers, and kept stupid policies in place. (Remember the "no RPGs in North America" bullshit for the Saturn? The kept that nonsense up for the Dreamcast, even though they just watched Playstation customers go hog fucking wild on RPGs.)
SEGA stopped making hardware because they had their heads up their asses about what do develop, how much to spend on it, how to market it, and how to build a proper library.
Nintendo, SONY and Microsoft have none of those problems. They're all going to stay in the hardware business.