This. Even _new_ ARM processors like A9 and A15 are still 32-bit, and this is at the heart of many (most?) smartphones. Many low end x86 processors like a lot of Atom chips are also 32-bit only. Just because most new consumer x86 is now 64-bit doesn't mean at all that it's time to sunset a 32-bit JVM (if you'll ever be able to do that).
Oh, it'll shift to 64-bit on ARM soon enough. Power efficiency. Flags register consumes less power and less memory (cache) subsystem traffic.
It's funny that only things 64-bit ARM doesn't help with is supporting more physical RAM (32-bit designs like Cortex A7 and A15 support 1 TB) or 64-bit register width (almost totally useless). You probably want to rather use 128-bit wide NEON instructions...
Gingerbread is roughly four and a half years old and it still runs on about 6 percent of Android devices in use. Adoption of new technology lags a lot more at the tail - if Android was going to be completely off 32-bit in five years time it would have to have significant adoption already.!