EXCLUSIVE: Rumors are racing around Hollywood that Paramount Pictures chairman and CEO Brad Grey is on his way out after a 12-year run. The most widely rumored version is that Grey has packed up his office and canceled a bunch of meetings. The packing up the office rumor isn’t the case — he is not there, but the lot closed early today because of the Presidents Day holiday weekend. But it certainly seems that something is happening and that Grey’s run as chief is ending. It has been almost impossible to get a straight answer, but I’m told that conversations are going on right now between Grey and Viacom to figure out the future. Does Grey continue? That looks unlikely. Does he move to some emeritus post or one where he puts together projects of his own? That seems more on the mark.

Neither Viacom, Paramount or Grey would comment. I’ve heard that Viacom chief Bob Bakish will come to Los Angeles and meet with Grey, probably on Tuesday, so this cloud will hover over Melrose Avenue for days to go with the rainstorms. They will figure all this out by early next week.

The possibility of an exit has been the subject of speculation in town since Sumner and Shari Redstone deposed Philippe Dauman last year. Grey has led Paramount for 12 years but Paramount has lagged behind rivals in market share and the consistent generation of franchises with global appeal. That was particularly evident in 2016, when the studio is coming off its worst year in Grey’s run, losing $445 million in the fiscal year that ended last September. The studio finished at the bottom of the pile, below other majors.

MTV Europe Music Awards, Rotterdam, Netherlands - 06 Nov 2016

If Grey ultimately surrenders the reins, the speculation will quickly begin about who’ll emerge as the studio’s new leader. Immediate names will include Jim Gianopulos, who has been the top name for major jobs including the vacancy created when Michael Lynton announced he would step down in a few months at Sony. Others who might be considered include Mary Parent, the former MGM chairman who was brought in by former Legendary principal Thomas Tull before he was removed after selling to Wanda; and Michael De Luca, who with Jennifer Todd is currently producing the 89th Academy Awards on February 26. Another would be Rob Friedman, the former Lionsgate motion picture group co-chairman who knows Paramount well from his previous run there as vice chairman.

Rumors have been rampant, and it has become a daily chat with Paramount getting the latest ones denied, even as the pieces seem to be falling into place. There are a lot of variations. There are expectations that good things will happen to Amy Powell, whom Grey moved in 2013 from her post as a digital executive to start a TV production division that has been a bright spot. She has been rumored to fill some role in Paramount’s film studio. Other executives here who will not have a restful weekend include Andrew Gumpert, the former Sony exec whom Grey just hired as COO and business affairs head, and production president Marc Evans and marketing chief Megan Colligan. In a recent interview with Deadline, Bakish said he was a fan of Evans and that both he and Powell were “doing a good job.” He would not address direct questions of whether Powell would move to film or what would happen to the film exec roster going forward.

Bakish is a proponent of creating synergy between the studio and its branded networks. Past attempts to do that, when brands like Nickelodeon and MTV were stronger, never came to much in a consistent way, so it is unclear whether this would be as effective as, say, the launch of a dedicated family film division that Grey named as a priority in an interview with Deadline last fall. Studios like Universal with Illumination and Disney with Pixar and the Disney animation brand, have been minting money with animated films during the summer and holiday months.

Grey, who in 2015 was re-upped until 2020 by former Viacom chief Dauman, had campaigned with Shari Redstone and Dauman’s replacement Bakish to be the one to move Paramount towards a rebound. His chances of that increased when Redstone abandoned plans to fuse Viacom with CBS in a move that would have left Les Moonves presiding over the two pieces (potential lawsuits by CBS institutional investors was among the reasons the merger didn’t happen). Grey also seemed to buy himself time when he made a whopping co-fi deal for three and possibly four years with Shanghai Film Group and Huahua Media that will add around 25% of the budgets for Paramount’s films and help launch them in China, where Shanghai Film Group is the second-largest distributor in the world’s fastest-growing theatrical market.

Today’s uncertainty indicates that Redstone and Bakish are leaning toward an overhaul from the top. That would mean that Grey, the former manager and principal in Brillstein Grey Entertainment, where he showed his skills in putting together watershed shows like The Sopranos and films like The Departed, didn’t generate enough of those kinds of memorable films for Paramount.

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Paramount Pictures

Despite having two films in the Best Picture race in Fences and Arrival, Paramount hasn’t been making enough movies, and too many of its big-budget bets faltered. That included Monster Trucks (which took a $115 million write-down months before the film was released and grossed just $60 million worldwide), and more recently xXx: The Return Of Xander Cage, an $85 million budget film that has grossed $265 million worldwide, but only $43 million in domestic ticket sales. The Robert Zemeckis-directed Brad Pitt-starrer Allied, which cost $85 million to make, grossed just $115 million worldwide; the Martin Scorsese-directed Silence, an independently financed drama that cost $40 million, has grossed just $7 million worldwide.

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Paramount Pictures

Long hailed for his survival skills, Grey has hung on through a wild ride for control of parent company Viacom last year that saw Dauman, the former estate lawyer for 93-year-old owner Sumner Redstone, ousted by Redstone and his daughter Shari after a protracted courtroom battle over the mental competence of the company’s founder. In the same time period, Rob Moore, a controlling influence on Paramount’s operations as vice chairman, was fired mainly for his advocacy of Dauman’s plan to sell almost half of Paramount to China’s Dalian Wanda Group for $4.9 billion, most of which would have been used to cure Viacom’s stock shortfall.

If Grey leaves the post, clearly Redstone and Bakish could not get past the fact that Paramount has atrophied during his dozen years running the studio, whatever the reason. Some of that could be attributed to Dauman’s strategy of drastically paring operating costs of Viacom’s TV operations and Paramount’s film studio in favor of a stock-buyback program that backfired when the divisions faltered and lost half of the value of the $16 billion or so that Dauman spent for shares.

At the start of Dauman’s tenure, Paramount under Grey had acquired DreamWorks, it released the Marvel superhero films, and later the DreamWorks Animation films. Paramount did not move when there was an opportunity to buy Marvel — I’ve heard Dauman nixed it — and instead got bought out of the remaining pictures on the deal when Disney bought Marvel, a move that cushioned the bottom line short term, but which changed the landscape of Disney. DreamWorks Animation left and was bought by Universal, and while Paramount kept the Transformers franchise in the divorce, DreamWorks principal Steven Spielberg now makes his movies at Universal.

Even though Paramount managed profitability in most of Grey’s years before last year’s money-losing performance, the studio did not keep pace with global-oriented rivals like Disney, Universal and Warner Bros, and sometimes generated as few as 10 films per year and relied on pre-buys and festival acquisitions to fill holes in the slate. Paramount has some stronghold franchises – Transformers and Mission: Impossible are two, and efforts are ongoing to relaunch the Tom Cruise-starrer Top Gun and a sequel to World War Z that likely will have David Fincher as director. Paramount made what Grey hoped to be a strong start into family fare with Amusement Park, a 3D-animated film for its 2019 schedule. There is the prospect of a big Leonardo DiCaprio-Martin Scorsese re-team on Devil In The White City (both DiCaprio and Scorsese are on the Paramount lot), and a Scorsese reteam with Robert De Niro, who’ll star with Al Pacino in the mob drama The Irishman. But there are also question marks: for one thing, its principal tentpole co-financier, Skydance, is seeing through the end of its Paramount deal and rapidly setting up self-generated product at studios all over town.

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In an interview with Deadline last fall, Grey said that with the fiscal shackles removed, he was moving quickly to fix Paramount’s internal problems that would lead the studio to generate 15-17 releases per year, and that he would start a dedicated family film division and be on the prowl for the kind of acquisitions that have made Disney by far the most dominant studio.

If the smoke signals are right, the Redstones and Bakish will have thought it best to give the studio a clean start with another top executive hoping to provide a rebound.