Sharp Revenue ContractionA near-30% decline in revenue materially reduces scale benefits, weakens customer leverage, and limits funds for R&D and talent retention. Sustained revenue shrinkage undermines the company’s ability to convert gross margins into operating profitability and long-term competitive strength.
Ongoing Operating LossesNegative net margins and a reported negative ROE indicate capital is being consumed rather than generated. Persistent losses erode the equity base and force reliance on external financing, constraining strategic options and increasing vulnerability if market conditions or customer demand worsen.
Severely Deteriorating Free Cash FlowA >100% decline in FCF and low cash conversion mean limited internal funding for capex, R&D, or working capital. Persistently weak FCF raises refinancing risk, may force dilution or higher-cost debt, and constrains the company’s ability to execute long-term product and market strategies.