Negative Gross ProfitA deeply negative gross profit indicates unit production costs and direct expenses exceed revenue, undermining margin sustainability. Until unit economics improve through cost reduction, process optimization or higher selling prices, revenue growth alone will not translate into operating leverage or durable profitability.
Persistent Cash BurnConsistently negative operating and free cash flow reflect ongoing cash consumption by operations and scale-up activities. Persistent cash burn elevates funding risk, can force dilution or limit investment in scale-up and commercialization, and constrains the company’s ability to self-finance margin-improving initiatives.
Small Scale, Funding RiskGrowth is from a very small sales base while losses and cash burn persist, leaving the business economically immature. Small scale limits ability to absorb fixed costs, raises sensitivity to customer concentration and implies continued need for external capital, risking dilution and execution pressure during scaling.