Paula Fortunato, the wife of Paramount boss Sumner Redstone, was enraged when she heard Cruise's comments on live TV, and warned her 83-year-old husband that the star's Scientology-inspired tirade is off-putting to female fans.
Redstone said last week: "As much as we like him personally, we thought it was wrong to renew his deal. His recent conduct has not been acceptable to Paramount."
The movie mogul originally hinted his decision was largely because of Cruise's bizarre antics on TV shows like The Oprah Winfrey Show and Today.
But insiders from Paramount's parent company Viacom claim Redstone's 43-year-old wife has great influence on the decisions of her aging husband.
Viacom spokesman Carl Folta says, "It is true that Mrs. Redstone disagrees with Tom Cruise's views, but she and Mr. Redstone see every Paramount film."
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