Inconsistent Gross MarginsVolatile gross margins signal uneven cost control or pricing power, which can erode long-term profitability. Persistent inconsistency makes earnings less predictable, complicates strategic planning, and increases sensitivity to input cost shocks and competitive pricing pressure.
Fluctuating Return On EquityVariability in ROE indicates uneven returns on shareholder capital and potential inefficiencies in capital allocation. Over months this can undermine investor confidence, limit ability to sustain higher reinvestment rates, and reflect operational or margin instability.
Very Small Employee BaseA three-person workforce creates structural execution and scalability risk: limited capacity for product development, sales, and service, plus key-person dependency. This constrains ability to scale contracts, increases operational bottlenecks, and raises succession risk.