iRobot, the maker of the popular Roomba vacuum, has filed for bankruptcy. The latest development for the U.S. company, which makes its products in Vietnam, comes two years after it failed to merge with Amazon.
Why did iRobot file for bankruptcy?
iRobot filed for bankruptcy after struggling to climb out of massive debt and facing increasing tariff costs in recent months.
According to NPR, the company revealed in its filing that it owes $3.4 million in unpaid tariffs to U.S. Customs and Border Protection. iRobot also owes $100 million to Shenzhen Picea Robotics, the supplier, which will now manage the firm.
Who founded iRobot?
It was researchers at the Massachusetts Institute of Technology who founded iRobot in 1990. The company first made devices for the U.S. military before building tools to help people clean their homes. In recent years, however, the company struggled to keep up with competitors making smart vacuums and selling them for lower prices.
Amazon tried to purchase iRobot for $1.4 billion in 2024
That effort, however, failed as competition regulators in Europe and the U.S. opposed the move. The latest quarter report for iRobot revealed that sales declined by 33% in the U.S. The company began planning for bankruptcy in March, amid concerns about the tariffs imposed by President Donald Trump and its struggles to keep up with rivals.
What’s next for iRobot after filing for bankruptcy?
After filing for bankruptcy, iRobot is going private and selling the company to Picea, its contract manufacturer. According to RollOut, the agreement states that iRobot will be relieved from the debt it owes to Picea for manufacturing its robots. In exchange, Picea will own the entirety of iRobot.
iRobot said neither its app, supply chains, nor product support will be disrupted by the bankruptcy filing.