From the outside, the idea made no sense at all. Why would a broadcast network cancel one of its best-known shows that ranks number one in its time slot?
But on the inside, at CBS, there were several plausible answers to that question. While “The Late Show” host Stephen Colbert was on his usual mid-summer vacation earlier this month, CBS executives weighed the pros and cons of canceling the unique but unfortunately unprofitable show.
The “cons” were obvious, as evidenced by the studio audience’s boos when Colbert announced the cancellation on Thursday night.
However, the “pros” ultimately won out because, according to sources close to the network, “The Late Show” was losing money and there was no apparent path to turning around its financial position.
It was an “agonizing decision,” as the executives admitted in a statement.
But CBS insiders insist, even when speaking frankly on condition of anonymity, that the move was financially driven, not politically motivated.
Many observers have huge doubts about that, given that Colbert has been an outspoken critic of President Trump. So here’s what the data indicates.
Late-night TV’s unfortunate reality
The bottom has indeed been falling out of the late-night TV business model for several years now. Audience fragmentation and digital competition have led to a decline in ad revenue across the board. One insider described it as “cratering” at CBS.
That’s because, even though Colbert outrated his competition at 11:35 p.m., the overall audience for late-night has been shrinking.
“Ad dollars and audiences are moving away from late night shows,” Variety reported — and that was back in 2023.
The financial picture has only gotten gloomier since then. Guideline, an ad data firm, estimates that the networks’ late-night shows earned $439 million in ad revenue in 2018 and only $220 million in 2024 — a decline of 50 percent.
The shows hosted by Colbert and his rivals, Jimmy Fallon and Jimmy Kimmel, are inherently expensive to produce, with hundreds of staffers and elaborate studio productions.
But couldn’t CBS have explored changes to the cost structure? That’s what the network did later in the evening, in its 12:35 a.m. time slot, in 2023. “The Late Late Show with James Corden” ended, partly due to the fact that it was no longer making money for CBS, and a cheaper show called “After Midnight” was launched in its place.
Colbert was an executive producer on both “After Midnight” and “The Late Show,” so he had some visibility into the financial circumstances.
But the swiftness of the network’s decision suggests that he wasn’t given much time to suggest cost savings or other alternatives.
A ‘casualty of the merger’?
That’s why one person close to Colbert described the show’s retirement, effective in May 2026, as a “casualty of the merger.”
That merger is CBS parent Paramount’s long-gestating deal with Skydance, a media company controlled by David Ellison, son of Oracle billionaire Larry Ellison.
The elder Ellison is a longtime friend of President Trump and has previously described himself as a Trump supporter. And David Ellison was spotted with the president earlier this year at UFC matches.
The pending deal matters for two reasons: One, because companies almost always try to cut costs around the time of a merger; and two, because the deal requires sign-off from the Trump administration.
Paramount entered into a settlement agreement with Trump earlier this month to resolve Trump’s lawsuit against the CBS News program “60 Minutes.” The company said it would pay $16 million toward Trump’s future presidential library. Trump suggested at the time that there were other components to the settlement.
While there is no evidence that Colbert’s cancellation is connected to the settlement, Democratic senators like Elizabeth Warren are asking questions about the possibility.
“America deserves to know if his show was canceled for political reasons,” Warren said in a statement Thursday night.
At the very least, CBS executives moved forward with the retirement of “The Late Show” franchise knowing that the optics would cause all manner of controversy.
Trump personally celebrated the cancellation on Friday morning, writing on Truth Social that “I absolutely love that Colbert got fired. His talent was even less than his ratings. I hear Jimmy Kimmel is next. Has even less talent than Colbert!”
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