Yes, it is a problem.
Looks like the rubber boot has failed. It might not be obvious at first, but these mouldings are known to end up with pin holes where the mould joins are.
When it stops spreading grease around, it simply means that all the grease has gone.
Depending on the age, as things are apart, it might be worth replacing the CV joint as well as most kd what needs to be done for that will have to be done anyway.
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