It could actually be a number of things, ingestion of debris damaged the piston and or rings, but that would also make it hard to start, idle, and maintain power under load, a faulty tired or damaged ignition coil, which has internal circuitry to stop the production of spark every few rpms pr so, which in turn manages the revolutions limit so the machine runs at a specific top-end rpm, it could also be loose cylinder head bolts that allow compression to escape when at wide open throttle. I'd look straight through the carburetor into the engine with a flashlight for wear, find a spark tester with an adjustable gap feature that shows the spark produced, (incidentally, if the coil is good, consider a new plug as they always wear out at some point inside), and listen for pressure escaping around the head to block mating area as well as look for fuel spray patterns around the gasket or a buildup of 2-cycle oil. Hope this helps.
I would inspect the intake side of the piston behind the carburetor. The most common problem with cutoff saws with no water kit is fuel reversion. that is wear on the intake side of the piston that has removed over 10% of the machining marks like this:
If you do have wear like this consult a Stihl Gold certified dealer like www.arcolawn.com for parts and tools to repair it.
Good Luck
Gasoline cut-off saws are a simple and extremely robust tool that will easily last for many years if treated with respect and maintained regularly .
During normal operation it is absolutely imperative that the correct fuel/oil mix is always used. An incorrect mixture leading to a lack of lubrication is by far the easiest way to ensure an untimely death for your cut-off saw.
Here's a list of regular cut-off saw maintenance tips that will keep your machine running and running:
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