Colbert’s 'Late Show' wasn’t canceled — it was euthanized

Late-night host Stephen Colbert announced on July 17, during a live broadcast, that CBS would be canceling "The Late Show."

Colbert was quick to cast the move as political, with longtime friend Jon Stewart going further on "The Daily Show," portraying Colbert as a victim of Trumpian machinations — complete with a gospel choir chorus of “Go f--- yourself” aimed squarely at CBS executives. 

It made for enjoyable theater but conspicuously lacked counterfactual arguments. Amid the bluster, neither Stewart nor Colbert offered a serious defense of the show’s underlying business performance.

Let it be stated with clarity: "The Late Show" was not primarily felled by politics. It was a casualty of audience migration — away from legacy television and toward streaming, social media and podcasts.

"The Late Show" wasn’t merely canceled — it was euthanized.

Colbert built "The Late Show" around political comedy, an extension of his Comedy Central persona rooted in partisan satire. It worked in the linear TV era, especially during the Trump presidency. But it’s ill-suited for the digital economy where content lives or dies by shareability and replay value.

Jimmy Fallon’s "Tonight Show," shaped by his Saturday Night Live roots, mixes sketch comedy, musical impersonations and celebrity games. This format isn’t entirely apolitical — it often contains soft political touches — but it is built for viral clips that can thrive for years on TikTok, YouTube and Instagram long after the original broadcast. 

Fallon boasts 76.3 million social followers — over three times Colbert’s 20.7 million — and drew 9.2 billion social views from June 2024 to May 2025. 

Pew Research shows 75 percent of TikTok creators with over 1 million followers focus on entertainment, while only 6 percent create political content. Political monologues decay quickly. Sketches, musical bits and celebrity impressions accrue long-tail value, driving both cultural currency and incremental revenue.

Colbert may have edged Fallon in TV ratings, but Fallon won where it matters now: digital relevance and monetization.

Even acclaimed shows must make money. Running "The Late Show" was like CBS funding a tentpole blockbuster every year, only without the box office returns. CBS insiders estimate the show lost $40 to 50 million annually for years. Production costs, including a staff of nearly 200, approached $100 million a year. Revenues never came close — ad sales fell 25 percent to about $70 million by 2024, and streaming added just $60 million over four years.

Megan Kelly recently noted that her Fox News primetime show, "The Kelly File," generated $100 million in revenue with never more than 12 employees, at one-tenth Colbert’s cost. "Gutfeld!" (late-night’s current ratings king) reportedly operates on similar lean metrics. 

Like Colbert, Greg Gutfeld’s Fox show lacks Fallon’s variety-show appeal, but unlike Colbert, he isn’t shackled to a massive budget and consistently delivers wide operating margins.

Paramount’s phrase “challenging revenue environment” was boardroom code for this truth: "The Late Show" was structurally unprofitable and had been for years. Cancellation was not political. It was a financial inevitability.

It's also critical to understand that ratings are not enough on their own. In his on-air cancellation announcement, Colbert cited his Nielsen ratings lead — 2.4 million viewers vs. Fallon’s 2.1 million in the second quarter of 2025 — as proof of his unjustified cancellation. But ratings don’t pay the bills.

Advertisers buy monetizable reach, increasingly found online. Fallon’s broader appeal across digital platforms drew far more advertiser dollars, despite his smaller television audience. A narrow win in a shrinking broadcast demographic is meaningless when the ad dollars flow elsewhere. 

Colbert led the wrong scoreboard, and CBS executives knew it.

Late-night TV also cannibalizes itself. CBS, NBC, and ABC chase the same progressive-leaning audience according to Pew Research, splitting an already shrinking base three ways. "The Late Show" never truly owned its audience, it shared it. 

"Gutfeld!" doesn’t have that problem. As the only mainstream right-leaning comedy show, it drew approximately 3.3 million viewers in the second quarter of 2025, regularly outpacing Colbert. It operates on a far leaner budget and is likely the only consistently profitable late-night show.

Colbert’s partisan guest list — 176 left-leaning guests versus one Republican since 2022 — left no room for growth beyond his base.

Cable news offers the same lesson: ABC, CBS, NBC, MSNBC and CNN carve up the progressive pie, whereas Fox consolidates the right and often wins nightly ratings outright. Fragmentation kills margins. Fox dominates because it owns an unshared lane.

All of these business failures — the weak content strategy, chronic losses, hollow ratings, and fractured audience — sit atop a deeper truth: Colbert’s cancellation was less about politics than about migration. A tectonic shift is occurring in how audiences consume comedy, and it has left the entire late-night format stranded in a dying medium. 

Cord-cutting surged after the 2008 financial crisis, and a new generation is being raised on iPhones and streaming apps, never having subscribed to TV in the first place. Pew Research data shows that by 2015, U.S. television subscriptions had already peaked and then began a steep, irreversible decline.

Audiences pivoted to streaming platforms, podcasts and on-demand comedy specials, where authenticity and autonomy replaced the old nightly broadcast ritual. Today, late-night variety comedy TV hosts are experiencing the whiplash of that unabated 10-year migration. 

Against this backdrop, the big-budget, five-nights-a-week variety format is a legacy product — a typewriter in a PC world. 

Poking the orange bear may have accelerated Colbert’s demise, but it was merely a leading indicator of the larger truth: The industrial model that sustained late-night television is collapsing, and no amount of political framing by Colbert, Stewart or anyone else can disguise that fact.

The late Cambridge physicist Stephen Hawking’s famous line was that "intelligence is the ability to adapt to change.” Colbert and his team showed little of that adaptive intelligence in the face of a rapidly evolving audience landscape.

Stephen Lile is a strategy and innovation fellow at the University of Cambridge Judge Business School. He is coauthor of the forthcoming book "Organized Science Denial," (Oxford University Press which discusses the news media's role in misinformation and disinformation.