It is my understanding that Tolkien wrote The Hobbit for his kids when they were of bedtime story age, and then wrote The Lord of the Rings for them when they were young adults and ready for a more mature story. It's not his fault everyone else for the rest of time wouldn't have that built-in delay.

LOTR was not written for children. It was literary fiction to talk about Tolkien's experiences with the Great war mixed with a lot of his philology studies. Some even say the LOTR world was just Tolkien's excuse to use his constructed languages. The Hobbit existed first as loose night time stories for his own kids that got formalized as a book and had no concept of the wider LOTR lore. The success inspired him to write another book, for a wider audience and more complex themes. Then he decided that the Hobbit could be made to fit into the overall world building of middle earth. So he made changes to both books so they fit together. That's why the first and second edition of The Hobbit are actually a bit different.

It’s literature, broadly speaking, and was never intended to be specifically for children. I think he wrote the Hobbit for children and LOTR for himself.