Negative Gross Profit And Deep LossesGross profit turning sharply negative means cost of sales exceeded revenue in 2025—an acute structural profitability failure. Persistent operating and net losses imply the current business model cannot sustain itself without meaningful cost, pricing or mix changes to restore positive unit economics.
Consistent Negative Cash FlowSustained negative operating and free cash flow creates lasting funding needs and forces reliance on external financing. This constrains strategic flexibility, increases dilution or debt risk, and raises the chance that shortfalls impair marketing, distribution expansion and ability to execute a turnaround.
Negative Equity And Elevated DebtNegative equity reflects accumulated losses and reduces financial resilience. Combined with meaningful debt, this elevates refinancing and covenant risk, limits capacity to invest in growth or margin repairs, and leaves the company vulnerable if market or distributor support weakens.