Persistent Operating LossesContinued negative operating results and a deeply negative net margin indicate the core business is not yet profitable. Persistent losses erode ability to reinvest, depress returns, and make durable recovery dependent on structural revenue growth or material cost transformation.
Negative Free Cash FlowNegative operating and free cash flow in consecutive years means the company is not self-funding. That heightens reliance on existing liquidity or external capital, increasing execution risk and constraining strategic investment until sustainable positive cash generation is restored.
Meaningful Equity ErosionSubstantial decline in equity and deeply negative ROE reduce the capital buffer available to absorb losses. This weakens long-term solvency margins, limits future financing flexibility despite low debt, and raises the bar for durable operational improvements to restore balance sheet health.