Speaking in an investor meeting, which was reported on by Japanese Twitter user NStyles and translated by Cheesemeister, Iwata said it wouldn't be efficient for the company to cut loose its existing audiences.
"The NX is new hardware, and will start from zero," he said. "However, the 3DS and Wii U have install bases. Immediately cutting off software for previous hardware upon the release of a new machine is inefficient."
The exec went on to reaffirm Nintendo's dedication to the Wii U: "We will continue making 3DS and Wii U software while preparing for the NX," he added. "We are prioritising satisfying customers who purchased the Wii U.
Nintendo's Shigeru Miyamoto -- famed for being the father of Mario -- previously discussed the Wii U's lacklustre performance, suggesting that its high price point may have been a contributing factor.
"Unfortunately with our latest system, the Wii U, the price point was one that ended up getting a little higher than we wanted," he said.
Continuing, Miyamoto said the rapidly evolving tablet market may have leapfrogged Nintendo, taking the shine off its vision for the Wii U and its tablet-like GamePad.
"I think unfortunately what ended up happening was that tablets themselves appeared in the marketplace and evolved very, very rapidly," Miyamoto explained.
"The uniqueness of [the Wii U's tablet] features were perhaps not as strong as they were when we had first begun developing them."
Nintendo has confirmed its next home console is codenamed the NX. The hardware was announced in March, around the same time the company also revealed plans to finally enter the smartphone market.
When asked for specifics on the NX, Iwata said Nintendo does not plan to fully reveal NX until 2016. He did, however, say the company is "calling it a 'new concept' ... not thinking of [it] as a 'simple replacement' for the 3DS or the Wii U."