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I'm going to put on my tinfoil hat for a little bit, so bear with me.
For a flagship title, Pokemon was pretty unreliable. Ever since the GBA, Gamefreak failed every single time to deliver a new Pokemon game close to a new system's release. Instead, they would go at their own pace and deliver Pokemon games for the previous console, while a new one, in need of boosting sales, was already on the market.
It must have been a hit for Nintendo when this happened with the 3DS and they had to resort to price cutting, because XY was still 2 and a half years away. But, in my opinion, the final straw must have been with the Switch.
Switch was a big gamble for Nintendo after severely underperforming WiiU and as usual, a Pokemon game for it was nowhere to be seen. In fact, Gamefreak openly expressed their doubts about the system. Thankfully for Nintendo, Switch turned out to be a huge success, with or without Pokemon to back it up. Increasing number of studios under their direct command also paid off. Even Gamefreak had to give up eventually and relatively quickly cooked up a glorified engine demo released as LGPE to get a feeling how to develop for Switch. However, its failure to meet expectations (given how not even a demo version released months after the game did not manage to bring in the usual numbers) must have made Nintendo bold enough to force Gamefreak's hand.
With strong Switch sales and no dangerous competition in hand, they decided to test Pokemon's strength under (controlled) fire. Nintendo deliberately put faults of Sword and Shield in the spotlight, expecting one out of two scenarios:
1) the games sell great as usual, profit is made as usual or
2) the games underperform and Nintendo has a good reason to attain more control over the franchise.
Keep in mind that Nintendo in general operates with long-term goals in mind. They have been around for so long for a reason and forfeiting profits now, while they're doing great, isn't such a big deal.
