Revenue CollapseRevenue effectively collapsing to near-zero removes the company’s primary cash engine. Without meaningful sales, fixed costs strain margins and supplier/customer relationships deteriorate, making any sustainable recovery difficult without new contracts, capital infusion, or a major operational reset.
Sustained Losses And Declining EquityPersistent deep losses and declining equity erode shareholder value and reduce financial flexibility. Negative returns on equity indicate structural profitability issues that hinder the company’s ability to attract investment, finance growth, or absorb further operating shocks.
Fragile, Volatile Cash GenerationOperating cash flow has been volatile and near-zero most recently, increasing dependency on external funding to cover deficits. This inconsistent cash generation constrains reinvestment, heightens refinancing risk, and makes executing a reliable multi-quarter turnaround plan materially harder.