High LeverageA high debt-to-equity ratio and low equity ratio show substantial reliance on borrowed funds, which raises interest burden and reduces financial flexibility. Over the medium term this elevates refinancing and solvency risk, constraining ability to invest or withstand revenue volatility.
Negative Free Cash FlowPersistent negative free cash flow, despite some improvement in operating cash flow, limits self-funding for capex, debt reduction, or shareholder returns. Continued negative FCF increases reliance on external financing, raising dilution or refinancing risk and hampering durable balance sheet repair.
Modest Margins Vs PeersWhile margins have improved, their modest absolute level versus peers limits the firm's buffer against competition and economic cycles. Lower relative profitability constrains cash generation and the pace at which the company can deleverage, invest, or build competitive moats over time.