Negative Shareholders' EquityNegative equity signals that liabilities exceed assets and creates a structural solvency risk. This restricts borrowing capacity, raises covenant/default risk, and often necessitates recapitalization or dilution, imposing lasting strategic and financing constraints over the coming months.
Negative Operating And Free Cash FlowPersistent negative operating and free cash flows mean the business consumes cash rather than generates it. Without a clear shift to positive cash conversion, the company will depend on external financing, limiting reinvestment capacity and threatening continuity over a 2-6 month horizon.
Declining Revenue And Negative MarginsSustained revenue decline alongside negative gross, EBITDA and net margins indicates the core business is not covering costs. This undermines the business model's viability and means achieving durable profitability will require substantial operational change or new revenue streams.