:max_bytes(150000):strip_icc()/GettyImages-1945576902-92c60dbc3a3340ad87de57a6036b3d3c.jpg "Roomba Maker iRobot Declares Bankruptcy. Its Stock Is Plunging 70%")
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Key Takeaways
- Roomba robot vacuum maker iRobot announced a Chapter 11 bankruptcy filing on Sunday.
- A deal for Amazon to buy the company fell through last year.
Shares of iRobot (IRBT) plummeted over 70% Monday morning after the Roomba robot vacuum maker announced a Chapter 11 bankruptcy filing on Sunday.
The company said it plans to have one of its lenders and its primary contract manufacturer, a Chinese robotics firm called Picea, acquire 100% of its equity, with iRobot set to continue operating as a private company under Picea.
CEO Gary Cohen said the Chapter 11 filing and acquisition by Picea is a “pivotal milestone in securing iRobot’s long-term future” that will “strengthen our financial position and will help deliver continuity for our consumers, customers, and partners.”
Why This Matters to Investors
Chapter 11 bankruptcy filings often involve companies working out court-mediated agreements with creditors to restructure their operations to improve their financial position, and can also result in those lenders acquiring a company’s assets. In this case, iRobot has agreed to a deal to be acquired by Picea.
Current Roomba users shouldn’t be impacted and their devices should work as normal, as iRobot said there is “no anticipated disruption to its app functionality, customer programs, global partners, supply chain relationships, or ongoing product support.”
A previous plan for iRobot to be acquired by Amazon (AMZN) faced increasing regulatory scrutiny in late 2023, with the deal falling apart when Amazon backed out in January 2024. At the time, iRobot replaced its CEO and said it would lay off 350 employees, about 30% of its workforce.
Earlier this year, iRobot launched a strategic review of its options, as the company said tariffs, macroeconomic conditions, consumer demand, and competition were creating “substantial doubt about the Company’s ability to continue as a going concern” for the next year. Shares fell 35% that day in March, and iRobot shares have remained largely below $5 in the months since.
With Monday’s losses, iRobot shares have lost about 85% of their value in 2025.
