The inventor of the Roomba robotic vacuum sought Chapter 11 bankruptcy protection Sunday as Picea Robotics, the Chinese company that manufactures its products, moves to take control of the struggling Massachusetts firm.
The Delaware bankruptcy court received the filing from iRobot, which has struggled for months with mounting losses despite pulling in $682 million in sales last year. Cheaper products from Chinese competitors, particularly Ecovacs Robotics, have steadily eaten into the company’s profits.
Federal tariff policies have accelerated the company’s decline. Washington imposed a 46% import duty on goods from Vietnam, where iRobot runs its manufacturing operations for North American sales. The tariff hit cost the company $23 million this year and created major operational headaches, bankruptcy documents show.
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iRobot owes creditors roughly $190 million, money the company borrowed in 2023 to keep operations running during a lengthy regulatory review of a proposed sale to Amazon. European competition authorities ultimately blocked that transaction, prompting Amazon to walk away in January 2024 after paying a $94 million termination fee.
The company still dominates important markets despite its financial troubles. iRobot controls 42% of robotic vacuum sales in the United States and commands an even stronger 65% share in Japan.
Three roboticists from the Massachusetts Institute of Technology launched the company in 1990, initially pursuing military and aerospace contracts before pivoting to consumer products. The company introduced the Roomba in 2002, creating an entirely new product category that made autonomous home cleaning mainstream.
Investors have fled the stock in recent years. The company’s market capitalization collapsed from $3.56 billion in 2021 to approximately $140 million at present. The Bedford headquarters now employs 274 workers, according to court filings.
Shareholders will lose their entire investment under the bankruptcy plan. Company officials pledged to maintain normal operations and continue supporting all existing products during the restructuring.
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