Virtually No Recurring RevenueSustained near-zero revenue leaves the business without scale or a proven commercial model, making margins and cost recovery impossible. Long-term viability depends on establishing durable revenue streams; until then the company lacks core fundamentals to generate profits.
Persistent Negative Operating And Free Cash FlowChronic negative operating and free cash flow forces dependency on external funding, limiting strategic flexibility and capital allocation. Over months this erodes runway, restricts investment in growth initiatives, and increases the odds of dilutive financings or cost-driven insolvency risk.
Rising Leverage Amid Eroding EquityIncreasing debt relative to shrinking equity structurally raises financial risk: higher interest and covenant exposure reduce resilience to shocks and constrain future borrowing. With persistent losses, deleveraging will be difficult and solvency pressures could intensify over several quarters.