Negative Profitability And Shrinking MarginsSustained negative net and EBIT margins limit internal funding for R&D and sales expansion. Shrinking gross margin suggests pricing pressure or higher costs, eroding the ability to achieve operating leverage even as revenue grows modestly.
Negative Operating And Free Cash FlowWeak cash generation undermines self-funded growth and increases reliance on external financing. Persistent negative OCF and FCF reduce flexibility for product investment, M&A or marketing, elevating liquidity and refinancing risks over a multi‑quarter horizon.
Rising Leverage / Higher Debt RelianceAn increased debt-to-equity ratio raises interest and refinancing exposure, constraining strategic optionality. Combined with negative cash flow and losses, higher leverage materially heightens financial risk and could force tradeoffs between growth and solvency.