Negative EBIT And EBITDA MarginsConsistent negative operating profitability signals structural cost or efficiency issues: the company is failing to convert gross profit into sustainable operating profit. Without operational turnaround, this erodes capital cushions, constrains reinvestment, and risks recurring losses over the medium term.
Weak Cash ConversionNegative free cash flow growth and poor operating-cash-to-net-income conversion indicate the business struggles to turn accounting profits into cash. This undermines liquidity, forces dependence on external financing, and limits the company's ability to fund capex, pay down debt, or build reserves over coming quarters.
Revenue And Profitability VolatilityHigh revenue and profit volatility make forecasting and planning difficult and signal execution or demand inconsistencies. Inconsistent ROE reflects uneven returns on capital, raising the bar for management to deliver stable earnings and complicating strategic decisions over the medium term.