Continued GAAP Losses / Negative MarginsDespite margin improvements, persistent negative operating and net margins constrain internal capital generation and limit financial flexibility. Continued losses impede ROE recovery and mean the business needs sustained margin expansion to become self-sustaining without external funding.
Inconsistent Free Cash FlowVolatile free cash flow undermines the firm's ability to fund growth from operations. Even with positive operating cash flow, inconsistent FCF increases dependence on external capital for processing capacity and marketing, heightening funding and execution risk over the next several quarters.
Supply Quality And Onboarding BurdenSurging new-seller volume raises processing, education and quality-control costs and can depress sell-through, ASPs and conversion until cohorts mature. These structural supply-side frictions can inflate unit costs and pressure margins as the company scales acquisition channels like TikTok and other high-volume sources.