iRobot, known for its Roomba robotic vacuum, filed for Chapter 11 bankruptcy protection on Sunday night after 35 years in operation. The company had previously warned of its financial struggles and is planning to be acquired by Picea Robotics, a Chinese contract manufacturer. Despite the bankruptcy, iRobot has stated it will continue its operations without disruption to app functionality, customer programs, or product support, suggesting that Roomba devices will continue to function as usual.
Founded in 1990, iRobot gained prominence with the launch of the first Roomba in 2002. However, the company has faced increasing competition in recent years, particularly from Chinese manufacturers such as Ecovacs and Roborock. Although iRobot had a significant presence in the robot vacuum market, its share has diminished over time. A proposed acquisition by Amazon in 2022 aimed to stabilize the company but ultimately fell through due to regulatory concerns.
In response to market pressures, iRobot has updated its product range and adjusted pricing strategies to compete more effectively. Collaborating with Picea Robotics, the company has been working on new Roomba models. Nonetheless, iRobot continues to experience a decline in revenue, which industry sources attribute partly to tariffs affecting production costs, particularly in Vietnam where many of its vacuums are manufactured.
Gary Cohen, the CEO of iRobot, indicated that the bankruptcy marks a crucial step in securing the company’s long-term viability and that the acquisition is intended to enhance its financial health while ensuring continuity for customers and partners.
Source: https://www.theverge.com/news/844460/irobot-files-for-bankruptcy