AI Financial Corporation — financial distress indicators
Financial-health summary
AI Financial Corporation's reported numbers place it in the 'Weak' financial-health band (distress score 53/100). The main indicators are losses in each of the last 3 years, share price down >80% from 52-week high and massive shareholder dilution. In its favour: revenue still growing (+109% yoy).
Stress by dimension
Share price — last 12 months
Indicators behind the score
Each red flag shows the evidence from the company’s own filings and the financial or legal principle behind it. Points add to the 0–100 score.
Net income negative in 3 of 3 fiscal years.
Persistent losses erode equity and the capacity to absorb shocks.
Price is -86% from its 52-week high.
Equity markets price distress early; collapses of this size usually reflect fear of wipe-out in a restructuring.
Share count up +720% in a year.
Survival financing: repeated equity raises at depressed prices.
Cash covers ~18 months of free-cash-flow burn.
Funding needs within two years make the company dependent on capital-market access.
Last price $0.44.
Below the $1 minimum-bid listing standard (Nasdaq Rule 5550(a)(2) / NYSE 802.01C); sustained breach leads to delisting and loss of capital-market access.
Operating margin fell from -42% to -92% in two years.
Sharp margin compression signals loss of pricing power or cost control.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- Revenue still growing (+109% YoY).
📰 Recent news scan
- Alyea Therapeutics to Attend the ArcStone-Kingswood Growth Summit 2026 in TorontoYahoo Finance · 2026-09-14
- Trump-linked fintech firm AI Financial sells unit to PrimeDeltaYahoo Finance · 2026-08-08
- Perpetuals.com ends acquisition talks with Trump-linked crypto firmYahoo Finance · 2026-07-14
- Statement on a Proposed Transaction With AI Financial CorporationYahoo Finance · 2026-07-07
- A Trump Crypto Bet Vaporized 92% Of This Stock— But Here's Why The CEO Won't SellYahoo Finance · 2026-06-15
- Trump Family Scores Massive Payday as Company Falls ApartYahoo Finance · 2026-06-10
⚖️ U.S. legal pathway — Title 11, U.S. Code
Which chapter would apply?
- Chapter 11 — reorganisation. Management usually stays in control as debtor-in-possession; the automatic stay (§362) halts collection; a plan must meet the best-interests test (§1129(a)(7)) and the absolute priority rule (§1129(b)) — creditors are paid before shareholders, who are frequently wiped out.
- Chapter 7 — liquidation. A trustee sells assets and distributes proceeds by statutory priority (§§507, 726).
- Subchapter V (“Chapter 5”) is a fast track for small-business debtors under a statutory debt cap, but SEC-reporting companies are excluded (§101(51D)) — so it rarely applies to listed companies.
What typically triggers a filing
- Payment default or covenant breach lenders will not waive; a debt maturity that cannot be refinanced.
- Auditor going-concern doubt (ASC 205-40 / PCAOB AS 2415) — often itself a default trigger in loan agreements.
- Creditors can force a case with an involuntary petition (§303) if debts are not paid as they come due.
- Delisting after sustained sub-$1 prices or equity deficits cuts off equity funding.
Transactions shortly before filing can be clawed back (preferences — 90 days, §547; fraudulent transfers — 2 years, §548).
Frequently asked questions
What do AI Financial Corporation's financial-health indicators show?
As of 2026-10-08, AI Financial Corporation's public financial data places it in the 'Weak' band with a distress score of 53/100, driven by losses in each of the last 3 years, share price down >80% from 52-week high and massive shareholder dilution. This is a statistical screen of reported numbers — it does not mean the company is insolvent, has defaulted or will enter insolvency proceedings.
What is AI Financial Corporation's financial distress score?
53/100 ('Weak').
What works in AI Financial Corporation's favour?
Revenue still growing (+109% YoY).
How are shareholders treated if a company enters insolvency?
In a Chapter 11 reorganisation the absolute priority rule pays secured lenders, then unsecured creditors, before shareholders — so existing shares are usually cancelled or heavily diluted. In Chapter 7 the company is liquidated and shareholders rarely recover anything.
Other IT & Software companies with distress indicators
- Cyabra, Inc. (CYAB)Very weak 100/100
- Exyn Technologies, Inc. (EXYN)Very weak 100/100
- The OLB Group, Inc. (OLB)Very weak 100/100
- Roadzen, Inc. (RDZN)Very weak 100/100
- Rekor Systems, Inc. (REKR)Very weak 100/100
- Veea Inc. (VEEA)Very weak 100/100
Methodology
Score = capped sum of rule-based red flags across seven dimensions (liquidity, solvency, profitability, cash flow, sales trend, market signal, news). Ohlson O-score (1980) gives an accounting-based 1-year failure probability; Merton distance-to-default (Bharath & Shumway 2008) gives a market-implied probability. Financial institutions use a capital-based rule set. Recalculated every trading day from the latest filings, prices and news.