Rising LeverageA meaningful step-up in debt and higher leverage erode balance-sheet flexibility, increase interest and refinancing risk, and reduce capacity to absorb shocks. Over a 2–6 month horizon this constrains strategic optionality and raises priority on cash generation to service obligations.
Margin CompressionCompression of net and EBITDA margins in 2025 suggests adverse mix, cost inflation or pricing pressure. Persisting margin erosion would materially reduce free cash flow and reinvestment ability, making it harder to sustain R&D, capex and shareholder returns without operational fixes.
Volatile Free Cash FlowUneven free cash flow conversion creates uncertainty around funding for growth, debt repayment and dividends. Volatility in FCF increases reliance on external financing during weak periods and complicates planning, limiting the company's ability to consistently reduce leverage or invest opportunistically.