Persistent Operating LossesRecurring operating losses signal the core business is not generating sufficient earnings to cover operating costs. Over several months this necessitates continual financing or cost cuts, erodes investor equity, and weakens the firm's ability to invest in growth or respond to shocks.
Minimal And Volatile RevenueVery low and highly erratic revenue undermines predictability and scale economics. Structural inability to grow or stabilize top line means fixed costs remain disproportionate to sales, making profitability and margin expansion unlikely without a durable revenue turnaround.
Eroding Shareholder EquityAccumulated losses have materially reduced the equity buffer, lowering financial resilience. Over the medium term this constrains financing options, increases dilution risk from equity raises, and signals the company has limited internal resources to fund recovery or growth.