Recent Net LossesReported net losses erode retained earnings and ROE, constraining internal funding for capex or working capital. Persistent losses can force strategic trade-offs, hinder investment in higher-margin products, and lengthen recovery time even if EBITDA holds steady.
High Financial LeverageA high debt burden raises interest and refinancing risk and reduces financial flexibility. Leverage magnifies downside from demand shocks and makes it harder to invest in growth or withstand shortfalls in cash flow, pressuring long-term balance sheet health.
Volatile / Negative Free Cash FlowNegative and volatile free cash flow impairs the company's ability to service debt, fund working capital, and invest in product/program expansion. Weak cash conversion increases reliance on external financing and elevates execution risk over the medium term.