Persistent Negative MarginsConsistent negative gross and net margins indicate structural unprofitability; without meaningful cost reengineering or pricing power, scaling revenue will not translate to profitability. This undermines sustainable free cash flow generation and long‑term shareholder value.
High Financial LeverageA high debt‑to‑equity profile with shrinking equity signals elevated solvency and refinancing risk. Persistent leverage limits strategic optionality, raises fixed interest burdens, and can force asset sales or equity dilution, constraining durable investment in growth or operations.
Negative Operating And Free Cash FlowNegative operating and free cash flow show the business cannot self‑fund operations or capex, creating a structural reliance on external financing. Over months this pressures liquidity, limits strategic investments, and raises the probability of distress or dilutive capital raises.