Weak Cash Flow GenerationNegative free cash flow driven by elevated capex and weak operating cash flow impairs the firm’s ability to self-fund growth, dividends, or reserves. Persisting cash shortfalls would force external financing or cutbacks, reducing strategic optionality over coming quarters.
Revenue VolatilityHistorical revenue declines reveal sensitivity to market cycles and client activity, common in capital markets. Such volatility complicates forecasting, may pressure margins in downturns, and requires stronger diversification or countercyclical revenue streams to stabilize growth.
Fluctuating Asset BaseA shrinking or fluctuating asset base can limit scale in proprietary trading, securities inventory, or client financing capacity. Persistent asset declines may constrain revenue opportunities and signal balance-sheet adjustments that reduce long-term growth potential.