Negative Operating And Free Cash FlowPersistent negative operating and free cash flows undermine the company’s ability to self-fund capex, working capital and debt obligations. Over a multi-month horizon this raises refinancing and liquidity risk and forces dependence on external capital, weakening financial resilience.
Rising Reliance On DebtAn increasing reliance on debt raises interest and refinancing burdens, particularly concerning given weak cash generation. If economic conditions worsen or rates rise, higher leverage could constrain investment, elevate default risk, and reduce strategic flexibility over the medium term.
Net Profit Margin Still Relatively LowAlthough margins have improved, a still-low net profit margin limits retained earnings and the firm’s ability to build internal buffers. This constrains long-term capital accumulation, makes returns sensitive to cost pressures, and reduces runway before external funding is required.