Persistent Net LossesOngoing net losses constrain retained earnings and slow rebuilding of equity which limits reinvestment capacity. Until sustained positive net income is achieved, the company may face pressure on long-term profitability metrics and strategic capital allocation.
Declining Stockholders' EquityA shrinking equity base erodes the capital cushion that absorbs losses and supports lending capacity. If negative earnings persist, declining equity could raise refinancing or covenant risks and may necessitate dilutive capital raises, weakening long-term flexibility.
Thin MarginsLow gross and operating margins leave limited room to absorb wage inflation, pricing pressure, or increased compliance costs. In staffing, competitive pricing and seasonality can depress margins further; durable margin expansion is needed for long-term earnings resilience.