Persistent Operating LossesConsistent operating and net losses over multiple years show the company has not yet converted higher gross margins into positive operating profit. Continued negative EBIT margins constrain reinvestment, reduce retained earnings, and weaken long-term shareholder value creation.
Ongoing Cash BurnSustained negative operating and free cash flow across 2022–2025, including sizable -¥254M OCF and -¥259M FCF in 2025, indicate reliance on external funding if losses persist, reducing financial flexibility and increasing refinancing or dilution risk over the medium term.
Rising Leverage & Equity ErosionRapid increase in leverage combined with sharply negative returns on equity reflects shrinking shareholder equity and higher financial risk. If losses continue, deteriorating capital structure could constrain growth, raise borrowing costs, and limit strategic options over the next several quarters.