Weak Recent Cash GenerationA large decline in operating and free cash flow reduces the reliability of earnings and limits the company's ability to self-fund capex, R&D, or dividends. Persistently weak cash conversion raises financing and execution risk over a multi-quarter horizon if not reversed.
Cyclicality Of End MarketsQualitau's demand is tied to semiconductor capital spending cycles, which can sharply reduce test-equipment orders and compress margins in downturns. High current margins and ROE could normalize quickly in a cyclical trough, increasing revenue and profit volatility over the medium term.
Limited Organizational ScaleA relatively small headcount constrains capacity for large-scale deployments, global sales coverage, and simultaneous R&D programs. Limited scale can amplify execution risk, slow product development cadence, and reduce ability to diversify revenue across geographies and customer segments.