Persistent Operating And Net LossesConsistent large operating and net losses versus negligible revenue reflect an ongoing inability to cover fixed costs. Over months this undermines sustainability, forces repeated fundraising, and delays any durable recovery unless revenues scale or costs are materially reduced.
Eroding Equity And Shrinking Asset BaseMaterial declines in equity and assets weaken the company’s balance sheet buffer and reduce collateral for financing. This erosion limits strategic flexibility, increases dilution risk if equity raises are needed, and elevates long-term solvency concerns absent turnaround.
Negative Operating And Free Cash Flow (cash Burn)Sustained negative operating and free cash flow versus a tiny revenue base signals continued cash burn and ongoing funding needs. Over a 2–6 month horizon this pressures liquidity, increases reliance on capital markets, and raises the risk of dilution or funding gaps if improvements stall.