Why does my YouTube Short still show a video frame after I upload a custom thumbnail?

That can be normal. YouTube says a vertical video with a 16:9 custom thumbnail may get an auto-generated 4:5 thumbnail on Home, Explore, and Subscriptions, so those surfaces can still look like they grabbed a video frame. The custom image should still be used on the watch feed, watch history, and non-mobile surfaces. For a Short, use a 9:16 thumbnail, make sure the channel is verified and the change was saved in Studio on a computer, then give it some time—YouTube says thumbnail updates can take a while to show up.