Recurring LossesPersistent negative EBIT and EBITDA indicate the business does not currently generate operating profits, eroding equity and limiting reinvestment capacity. Over months this undermines sustainability absent meaningful margin recovery or structural cost and revenue changes.
Revenue Collapse To ZeroA reported drop of revenue to zero signals a severe loss of core sales or business disruption. This is a structural red flag for viability: without a clear path to restore recurring revenue, recovery depends on material new contracts, business model changes, or capital support.
Weakened Balance Sheet And Rising LeverageA sharp equity decline and a large rise in debt-to-equity materially increase solvency and refinancing risk. With a reduced capital buffer, the firm has less ability to absorb further losses, faces higher funding costs, and is more vulnerable to creditor constraints over the medium term.