The fact that a company does not earn money does not mean that the shares will fall. Although Software-As-A-Service Business Salesforce.com, for example, lost money for years, while recurring income grew, if you had shares since 2005, you would have done very well. But the harsh reality is that many loss companies burn out all their money and go bankrupt.
So the natural question for Metavia (Nasdaq: MTVA) Shareholders is whether they should worry about the percentage of cash combustion. For the purpose of this article we will define cash combustion as the amount of cash that the company spends every year to finance its growth (also called its negative free cash flow). First we will determine his cash landing track by comparing his cash burning with his cash reserves.
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The cash lane of a company is calculated by distributing its cash by burning his money. In June 2025, Metavia had cash from US $ 18 million and no debt. It is important that the burning of cash US $ 19 million was the backlog of twelve months. So it had a runway of approximately 11 months from June 2025. To be honest, this kind of short runway is clear to us, because it indicates that the company should significantly reduce its burning of money, or should otherwise increase cash immediately. Displayed below, you can see how his cash interests have changed over time.
See our last analysis for Metavia
Metavia has not included any income in the past year, which indicates that it is a company at an early stage that is still developing its business. So although we cannot look at the sale to understand the growth, we can see how the burning of money changes to understand how the expenditure is trending over time. It is possible that the reduction of 5.3% in the burning of cash in the past year is proof that management is tightening their belts while exhausting the cash reserves. Although the past is always worth studying, it is the future that mainly matters. So you might want to take a look at how much the company is expected to grow in the coming years.
Although Metavia shows a solid reduction in cash burning, it is still worth considering how easily the more money can yield, even to feed faster growth. In general, a listed company can cancel new cash by issuing shares or taking on debts. Many companies ultimately issue new shares to finance future growth. By comparing the annual cash combustion of a company with its total market capitalization, we can roughly estimate how many shares it should give to lead the company for another year (against the same burn).
