Negative Stockholders' EquityNegative shareholders' equity signals potential solvency issues and accumulated losses that erode the capital base. Structurally this limits financing options, may trigger creditor covenants or restructuring needs, and weakens the company's ability to withstand prolonged industry downturns.
Negative Operating And Free Cash FlowsPersistent negative operating and free cash flows reduce the firm's capacity to fund day-to-day operations, invest in capacity, or service obligations without external capital. Over months this increases reliance on financing or equity dilution, heightening liquidity and execution risk for strategic plans.
Sustained Negative Margins And LossesOngoing negative gross and net margins point to structural problems in pricing, cost control, or production efficiency in apparel manufacturing. Without durable margin recovery, revenue growth may not translate to profitability, threatening long-term cash generation and competitive positioning.