An Asbury Park Press article cited City Manager Terence Reidy who bore the bad news:
The increasingly expensive headliners - like 2012's Foo Fighters, Bon Jovi and Skrillex - likely didn't help with the profitability of the festival but the promoters are still optimistic about a 2013 edition, saying somewhat vaguely:
Live Nation has informed us that at least for Bamboozle — because of the economics of doing it in Asbury Park and where the city is and where they are — it won’t work here. But this is not a breakup. This is Live Nation making a determination about this particular event, and that we will continue to work with Live Nation on other events in Asbury Park.
We’re always trying to provide Bamboozle fans with the most spectacular musical experience possible. We haven’t made final plans for Bamboozle ’13, but (we) will let everyone know as soon as they’re finalized.