High LeverageMaterially higher leverage reduces financial flexibility and raises refinancing and interest-rate risk. If operating performance stalls, servicing elevated debt could force cost cuts or limit investment in R&D and capacity, constraining long-term competitive positioning and raising default vulnerability in adverse cycles.
Persistent Net LossesOngoing net losses signal that non-operating items or legacy costs still depress the bottom line. Until the company converts improved operating margins into consistent net profitability, retained losses will erode equity, limit capital return optionality, and impede investor confidence in sustainable earnings power.
Volatile Cash And ProfitabilityHistoric swings from negative to positive cash flow reveal inconsistency in demand, margins, or working-capital cycles. This volatility complicates planning, elevates execution risk for multi-year investments, and implies that recent cash improvements may not be fully structural until repeated across several reporting periods.