DKI — financial distress indicators
Financial-health summary
DKI's reported numbers place it in the 'Weak' financial-health band (distress score 61/100). The main indicators are operations consume cash, share price down >80% from 52-week high and ohlson o-score signals likely failure. Independently, the Ohlson accounting model puts its 1-year failure probability at 99%. In its favour: revenue still growing (+27% 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.
Operating cash flow negative in 2 of the last 3 years.
A business that cannot fund itself from operations depends on external capital to survive.
Price is -94% from its 52-week high.
Equity markets price distress early; collapses of this size usually reflect fear of wipe-out in a restructuring.
O-score 4.25 → model probability 99%.
Ohlson (1980) logit model of 1-year corporate failure; O > 0 (p > 50%) is the original failure cut-off.
Cash covers ~19 months of free-cash-flow burn.
Funding needs within two years make the company dependent on capital-market access.
Recurring net losses.
Repeated losses are a core input in both Ohlson and Altman failure models.
Last price $0.75.
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 -32% to -85% in two years.
Sharp margin compression signals loss of pricing power or cost control.
0 severe and 1 moderate distress-related headlines in the last 6 months.
Headlines are corroborating evidence only; they are weighted lightly and never drive a flag alone.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- Revenue still growing (+27% YoY).
📰 Recent news scan
- dilutDarkIris Prices $6 Million Public Offering at $1.44 Per Unit With Potential for Significant Share Dilution - Yahoo FinanceGoogle News · 2026-10-08
- darkiris-shares-after-hours-reverse-splits - Darkiris (NASDAQ:DKI) - BenzingaGoogle News · 2026-10-08
- Top stock movements in today's session. - ChartMillGoogle News · 2026-10-08
- DarkIris (DKI) Stock Volatility Draws Short-Term Traders - Timothy SykesGoogle News · 2026-10-08
- DarkIris (DKI) Stock Gains 16% After Hours: What's Behind the Move? - TradingViewGoogle News · 2026-10-08
- DarkIris Inc. Stock Rockets On Extreme Volatility Surge - StocksToTradeGoogle News · 2026-10-08
⚖️ 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 DKI's financial-health indicators show?
As of 2026-10-08, DKI's public financial data places it in the 'Weak' band with a distress score of 61/100, driven by operations consume cash, share price down >80% from 52-week high and ohlson o-score signals likely failure. 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 DKI's financial distress score?
61/100 ('Weak'). Ohlson O-score 4.25 (model 1-year failure probability 99%).
What works in DKI's favour?
Revenue still growing (+27% 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 Unclassified companies with distress indicators
- CNEY (CNEY)Very weak 100/100
- EPOW (EPOW)Very weak 100/100
- GIBO (GIBO)Very weak 100/100
- GNS (GNS)Very weak 100/100
- HKPD (HKPD)Very weak 100/100
- HUBC (HUBC)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.