Persistent LossesOngoing negative net margins mean the company is not converting sales into sustainable profits. Continued losses erode equity, limit reinvestment capacity, and increase the risk of dilution or restructuring unless management achieves durable cost or pricing improvements.
Extremely Thin Gross MarginNear-breakeven gross margin signals minimal pricing power and leaves little room to absorb input-cost increases. Structurally thin unit economics make sustainable operating profitability difficult without fundamental changes to pricing, product mix, or cost structure.
Negative Cash GenerationPersistent negative operating and free cash flow show the business consumes cash despite revenue growth, increasing funding and execution risk. Unless cash conversion reverses, the company may need external financing or asset adjustments, which can impair long-term strategy execution.