Roomba maker valued at $3.5 billion now worth $140 million
iRobot (IRBT.O), the maker of the Roomba vacuum cleaner, has filed for bankruptcy protection, saying that it would go private after being bought by Picea Robotics, its primary manufacturer.
The company, which raised concerns about staying in business in March, filed for Chapter 11 protection in Delaware bankruptcy court as it grapples with increased competition from lower-priced rivals and new US tariffs.
iRobot generated about $682 million in total revenue in 2024, but its profits have been eroded by competition from Chinese rivals like Ecovacs Robotics. iRobot remains dominant in key markets like the US and Japan, but competition forced it to lower its prices and make substantial investments in technological upgrades, according to bankruptcy court filings.
New US tariffs have also harmed the company, especially a 46 per cent levy on imports from Vietnam, where iRobot manufactures vacuum cleaners for the US market. The tariffs raised the company’s costs by $23 million in 2025, while making it more difficult to plan for the future, according to iRobot’s court filings.
The company, which was the target of a thwarted $1.4 billion buyout by Amazon.com (AMZN.O), has about $190 million in debt.
The debt stems from a 2023 loan that iRobot used to refinance its operations while a European competition investigation stalled the Amazon deal.
After the Amazon deal fell apart and iRobot fell behind on payments to Picea, the China-based manufacturer acquired iRobot’s debt from a group of investment funds managed by the Carlyle Group, according to court documents.
Under iRobot’s bankruptcy plan, Picea will take 100 per cent of the company’s equity and cancel the $190 million remaining on the 2023 loan, as well as an additional $74 million debt that iRobot owes to Picea under the companies’ manufacturing agreement.
Other creditors and suppliers will be paid in full, according to iRobot’s bankruptcy court filings.
iRobot said the bankruptcy is not expected to disrupt its app functionality, customer programs, global partners, supply chain relationships or product support.
The loss-making company was valued at $3.56 billion in 2021, driven by pandemic-fueled demand, but it is now worth around $140 million, according to data compiled by LSEG.
iRobot was founded in 1990 by three Massachusetts Institute of Technology roboticists. It initially focused on defense and space work before debuting the Roomba robotic vacuum in 2002.
The Roomba was an immediate success and it holds about 42 per cent of the US market share and 65 per cent of the Japanese market share for robotic vacuum cleaners, according to the company.
iRobot is headquartered in Bedford, Massachusetts, and it has 274 employees, according to court documents.