Declining Revenue TrendSustained revenue decline reduces scale benefits and makes fixed-cost absorption harder, pressuring margins and cash generation. If the top-line trend persists over several quarters, it undermines recovery prospects and limits reinvestment capacity for growth initiatives.
Negative Margins And LossesConsistent negative margins signal structural cost or pricing issues and operational inefficiency. Persistent losses erode retained capital, constrain reinvestment, and raise reliance on external funding, making durable profitability recovery more challenging.
High Leverage And Weak EquitySignificant leverage and low shareholder equity increase refinancing and solvency risk and limit strategic flexibility. With negative ROE and constrained free cash flow, debt burdens can force austerity or asset sales, impeding long-term operational turnaround.