While Arduino is strong in many regards and was a big improvement on the status quo when it came out in ~2005, they weren't very fast to respond to the rise of the esp8266 and super-low-cost boards made in China.

For a long time their cheapest product was the Uno R3 (with a 16 MHz 8-bit ATmega328) for about $25 while you could buy a Wemos D1 mini (with a 160 MHz 32-bit esp8266) for $2 - or an Uno clone on aliexpress for $3.

Arduino have updated their product line since then (the Uno R4 Minima offers a 48MHz 32-bit RA4M1 for $19) and it's understandable they wanted to retain compatibility with their 5v shield ecosystem. But they were definitely slow to respond to a changing market.