Declining Revenue And Negative MarginsSustained revenue decline combined with negative gross and net margins undermines core profitability and market position. Over a 2-6 month horizon this reduces free resources for investment, risks customer attrition, and indicates structural problems in product-market fit or pricing.
Negative Operating And Free Cash FlowPersistent negative operating and free cash flows deplete liquidity and force reliance on external funding. This structural cash shortfall limits reinvestment, raises refinancing risk, and can compel asset sales or dilution, constraining strategic options across months.
Negative Return On EquityNegative ROE shows shareholder capital is not producing returns, impairing the ability to attract new equity and making financing more costly. Over a multi-month horizon this restricts growth funding, weakens investor confidence, and complicates any recovery or scaling plan.