Craig Ferguson discusses why he left late night TV. I'm not sure how far his thought processes went beyond what he says in this piece but I can sure think of another reason why he might have ended his show. In show business, it's usually a good idea to not leave when you're at the bottom and they're showing you the door. You want to get out when you still look like something of a hit.
The Late, Late Show with Craig Ferguson had pretty much found its audience and while he might have been able to stay there for a few years, he wasn't going to soar. They weren't going to give him 11:35 even if he wanted it because he'd already shown he couldn't beat Fallon at 12:35. If the new host replacing Letterman drastically improved on Dave's numbers and brought in younger viewers, then Ferguson would have had the challenge of holding a lot of that audience and maybe modifying his act to do so. If the new host didn't improve on Letterman's ratings then the next step was for CBS to start cleaning house and changing their whole approach to late night.
So it was a lose/lose situation for Ferguson and by leaving when he did, he avoided all that and left as a guy with a successful late night show, as opposed to a once-successful late night show that got axed. And that was pretty smart, especially for someone who wanted to do more with his career than host a talk show until he dropped. Ferguson's very talented and not just as a stand-up, and now's he a mostly-free agent to pursue those those other areas. Pretty smart of him.