Negative Profitability And MarginsPersistent negative net profit and EBIT margins imply the business is not yet generating operating profits despite revenue growth. Continued losses erode retained earnings, limit reinvestment capacity, and raise the bar for achieving sustainable, self‑funded growth over the medium term.
Weak Cash Generation / Negative FCF GrowthNegative free cash flow growth and poor cash conversion from income constrain the firm's ability to fund capex and working capital internally. This increases dependence on external funding, which can dilute strategic flexibility and slow infrastructure or product investments needed for durable growth.
Eroding Gross Margins / Cost Management IssuesDeclining gross margins point to rising costs or pricing pressure that undercut scalability. If cost trends persist, the company may struggle to translate revenue growth into profitability, making long‑term margin recovery and sustainable returns to shareholders more challenging.