Update: Just “speculation,” Ninty says.

Original story: Pop quiz: What do you do if your company has a handheld gaming system that has sold over 110 million units? If you said sit back and let the money roll in, we are on the same page. However, if your company happens to be Nintendo, the correct answer is to release the DSi as an upgrade to the DS Lite, which was an upgrade to the original DS. Oh, and then apparently release another new model the next year.

Yes, that is correct, unconfirmed reports are rolling in that a new Nintendo handheld system is slated to be revealed at the end of 2010. The yet-to-be-named system will be based on Nvidia’s Tegra architecture, best known for use in the latest smartphones and the just released Zune HD, and is a drastic improvement over the current gen handhelds due to its “ARM-based processor with integrated Geforce graphics.”

As expected, no comment has been provided by Nintendo, but that has not stopped up from reaching out.