Loss-incurring

Describing a situation, activity, or entity that results in a financial deficit or the reduction of assets. It signifies a period where expenses exceed revenue or where the value of investments decreases, leading to a negative financial outcome. This term is commonly used in business and finance to describe investments, projects, or companies that are not profitable. The severity of the loss can vary, ranging from minor financial setbacks to substantial and potentially crippling financial difficulties. The implication is that resources are being consumed without adequate returns, potentially jeopardizing long-term sustainability. It emphasizes a specific negative financial status, contrasting with profitability and financial gain.

Loss-incurring meaning with examples

• The struggling startup, burdened by high operating costs and minimal sales, was operating in a loss-incurring manner for the first three years. Investors were wary of providing further funding. They were concerned about its sustainability. Repeated losses prompted a change in the business model or eventual closure.
• After the global recession, the airline industry experienced a prolonged period of loss-incurring operations. High fuel prices, decreased passenger demand, and fierce competition all combined to diminish profits. Several carriers struggled with this sustained financial hardship leading to bankruptcies.
• The real estate developer discovered the project was loss-incurring, given the unexpected rise in construction material costs and declining property values. They made difficult choices. These decisions meant significant financial adjustments to salvage what could be recovered from their investment, including halting construction.
• Due to an unforeseen product recall, the manufacturing company faced a loss-incurring event. The costs of retrieving and replacing the defective products, as well as potential lawsuits, created an expensive period. They had to find alternative means to offset their financial strain.