So, it didn't take long for the Brickset.com article to get "retracted". The author (who also happens to be the founder/creator of Brickset) updated his article to say the cancellation rumor is false.
Nexo Knights is an enjoyable theme and my minimal research suggests that it's popularity at launch is on par with the Lego Friends launch. Ninjago and Legends of Chima appear to have been more popular during their launch, but that's how it goes with product launches: you win some, you lose some. The fact that searches on Google for Nexo Knights didn't have much of a spike for Christmas 2016, is a bit discouraging, though.
This is a Google Trends comparison of a few recent Lego themes. This is NOT actual sales data from Lego, just a simplified representation of search engine popularity according to Google.