Declining Revenue And LossesSustained revenue decline reduces scale and erodes fixed-cost absorption, making profitability restoration harder. Ongoing losses deplete equity and limit ability to invest in product development or sales expansion, risking market share loss and weaker competitiveness over the medium term.
Inconsistent Cash GenerationIrregular operating cash flow and weak free cash conversion constrain the firm's ability to fund R&D, capex, and service debt from operations. This structural cash weakness increases reliance on external financing and reduces strategic flexibility over the next several quarters.
Weakening Balance SheetFalling equity and shrinking asset base indicate erosion of the financial cushion. Even with only moderate leverage, a weakening capital structure raises vulnerability to shocks, limits capacity to win contracts requiring performance security, and hampers long-term investment capacity.