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David Letterman said Thursday that he had told CBS Corp. President-CEO Les Moonves that he will leave the "Late Show" next year after his current contract expires.
"I phoned him just before the program," Mr. Letterman said during the taping of his show, "and I said 'Leslie, it's been great, you've been great, the network has been great, but I'm retiring.'"
"Do I have a minute to call my accountant?" bandleader Paul Shaffer joked in response.
Mr. Letterman's departure in 2015 will likely complete the generational handover of late-night TV that's been underway for several years, most recently when Jimmy Fallon took over NBC's "Tonight Show" from Jay Leno, Mr. Letterman's arch-rival. That followed ABC's installation of Jimmy Kimmel in the 11:35 p.m. slot, where the network's "Nightline" had long reigned, and the rise of cable competition with more youth appeal, including "The Daily Show With Jon Stewart" and "The Colbert Report" on Comedy Central.
Mr. Letterman does better than Mr. Kimmel among total viewers but trails his ABC competitor among viewers 18 through 49 years old, according to Nielsen ratings. The "Tonight Show" beats both rivals for total viewers and 18-to-49-year-olds.
It's not clear who CBS might install in place of Mr. Letterman, 66, who joined in the network in 1993 after NBC passed him over in favor of Mr. Leno for "Tonight." Craig Ferguson, host of CBS's "Late Late Show," wouldn't seem like an obvious candidate to attract a broad, young audience. Chelsea Handler is leaving her own nighttime talk show on E!, "Chelsea Lately," but seems like another longshot for the "Late Show" chair.
"When Dave decided on a one-year extension for his most recent contract, we knew this day was getting closer, but that doesn't make the moment any less poignant for us," Mr. Moonves said in a statement early Thursday evening. "For 21 years, David Letterman has graced our Network's air in late night with wit, gravitas and brilliance unique in the history of our medium."