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When I click fit frame to content, it only works for some of my text boxes. For other text boxes, it just adds more space.
How do I fix this?
No idea - could be simply that there's a tab or extra spaces in the text boxes.
But can't really help without screenshots or a sample document.
If a document is not behaving well then try
Open the IDML in InDesignSave the file as a new InDesign file with a new name
See if the issue persists.
You could also try resetting your preferences
The easiest way to reset everything is to delete the InDesign preferences: as soon as InDesign starts to boot hold down Shift, Alt, Ctrl (and Apple/Cmd if working on a Macintosh). A dialog will appear asking to delete the InDesign Preferences, select 'Yes' on this dialog.Further info and instructions here if needed:https://helpx.adobe.com/in/indesign/kb/indesign-preferences-support-file-locations.html
With a text box selected, you will see squares at the center of each side and in the corners. Double clicking one of these squares will collapse the associated side(s) to hug the contained text.