Yes, Nintendo usually makes a profit from their console hardware. However this time their entire business depends on a successful launch. Selling hardware at zero profit on launch is entirely possible. Zero profit at launch doesn't mean that the lifetime profits of the hardware will be zero. Consoles have long life time and parts get cheaper every year. They need to get the new ecosystem rolling and that requires lots of customers.
Only Nintendo knows their business best. Traditionally their average customer buys less games per sold console as Playstation and Xbox gamers. IIRC an average PS3 gamer bought 8 games, while an average Wii gamer bought only 2 games. But Wii was a one trick pony, unlike Nintendo handhelds. Nintendo handheld market is completely different (long product life time, lots of good games). Considerations like this make a big difference when you calculate an acceptable profit margin for the hardware.