Severe Revenue DeclineAn ~83% year-over-year revenue contraction signals material loss of demand or market share. Such a steep structural decline reduces operating leverage, undermines scale economics, and makes margin recovery and fixed-cost absorption difficult without sustained top-line stabilization or new revenue sources.
Persistent Operating LossesOngoing negative EBIT and EBITDA margins indicate the business currently cannot cover operating costs from core operations. This erodes retained earnings, limits reinvestment capacity, stresses supplier/customer relationships, and requires external financing or structural cost reengineering to restore profitability.
Rising Leverage, Shrinking EquityIncreasing financial leverage alongside materially reduced equity weakens the balance sheet. Higher debt ratios constrain financial flexibility, increase interest burden, and exacerbate refinancing risk—hampering ability to invest in product, marketing, or supply-chain improvements needed for recovery.