Cary Fukunaga is out as the director of New Line’s two-part adaptation of Stephen King‘s “It,” which will not move forward as planned this summer and has been pushed indefinitely, multiple individuals familiar with the situation have told TheWrap.

Insiders tell TheWrap that “True Detective” director Fukunaga repeatedly clashed with the studio and did not want to compromise his artistic vision in the wake of budget cuts that were recently demanded by New Line, which greenlit the first film at $30 million. The situation came to a head over Memorial Day weekend, leading to Fukunaga’s abrupt exit from the ambitious project.

“It” was originally set up at Warner Bros. before moving to New Line in recent weeks, which was one reason behind the unfortunate split. Shooting locations were another issue at the heart of the departure, with Fukunaga expressing a strong desire to film in New York, which is more expensive than other locales. Another source indicated that New Line was getting cold feet about the project in the wake of the less-than-stellar opening of “Poltergeist,” which featured a clown in its marketing materials.

Also Read: Cary Fukunaga's 'It' Casts 'We're the Millers' Star Will Poulter as Pennywise the Clown

As the start of production loomed in mid-June, Fukunaga’s recent drafts were coming in over-budget, and New Line has had success with genre movies when it has maintained a hard financial line. The budget conflict over “It” had been brewing for weeks, as Fukunaga discovered when he initially tried to cast Ben Mendelsohn as the titular villain.

While many assumed Mendelsohn was forced to turn down “It” due to his pending involvement in “Star Wars: Rogue One,” an individual with knowledge of the situation told TheWrap that the Australian actor could’ve starred in both movies — “It” in June and “Rogue One” in September — but New Line wanted Mendelsohn to take a sizable pay cut, prompting him to pass on the project.

It’s unclear whether New Line will hire a new director to immediately take over the project or go back to the drawing board for an entirely new approach, but one insider told TheWrap that “It” was dead as currently constituted. A studio insider acknowledged the film has been pushed indefinitely but did not go into the specifics of Fukunaga’s exit.

Also Read: Cary Fukunaga to Direct Untitled Father-Son Drama for A24

“We’re the Millers” star Will Poulter had been in negotiations to star in “It” as Pennywise the Clown, a shape-shifting child murderer who terrorizes the town of Derry, Maine, where a ragtag group of kids come together to battle him as well as their own demons.

Fukunaga grew up as a huge fan of “It” and believed that King’s classic novel deserved an epic adaptation. His ambitious plan called for two movies — the first would feature the protagonists as children, while the second would focus on the characters as adults. However, that was a dicey proposition for New Line, as it’s difficult to market a movie starring children to an adult audience.

While New Line hoped Fukunaga would at least cast a movie star as Pennywise, the director ended up casting a young and unproven actor in Poulter, who represented an exciting proposition but a gamble nonetheless. It’s unclear whether he’ll be involved in a future incarnation of the project, but a new director would likely want to conduct their own casting search.

Also Read: Cary Fukunaga to Direct 'The Alienist' TV Series

It wouldn’t be surprising if New Line ended up adapting King’s acclaimed book as one long movie, featuring both children and their grown-up counterparts, as insiders say that is the studio’s ultimate wish.

Roy Lee, Dan Lin and Doug Davison are producing “It” with Seth Grahame-Smith and David Katzenberg, while Niija Kuykendall, Dave Neustadter and Walter Hamada had been overseeing the project for Warner Bros. and New Line. Fukunaga wrote scripts for two “It” movies along with Chase Palmer.

Fukunaga is expected to refocus his attention on A24’s anti-bullying drama about Joe and Jadin Bell, as well as Anonymous Content’s miniseries “The Alienist,” based on the novel by Caleb Carr.

King, for his part, weighed in on Twitter with his own dark sense of humor, which is a hallmark of his writing.

The remake of IT may be dead–or undead–but we'll always have Tim Curry. He's still floating down in the sewers of Derry. - Stephen King (@StephenKing) May 25, 2015