Roomba maker iRobot gets cleaned out in Chapter 11

Company vacuumed up by its own manufacturer

iRobot, the company behind autonomous vacuum cleaner brand Roomba, has filed for Chapter 11 bankruptcy protection, telling investors that its Chinese manufacturer will assume control going forward.

The business entered Chapter 11 proceedings on Sunday and initiated a restructuring support agreement (RSA) that would see Shenzhen-based Picea Robotics acquire the company in full.

Operations will run as usual throughout the Chapter 11 process, as well as meeting its financial commitments to staff, vendors, and creditors, iRobot said in a statement.

"Today's announcement marks a pivotal milestone in securing iRobot's long-term future," said CEO Gary Cohen. "The transaction will strengthen our financial position and will help deliver continuity for our consumers, customers, and partners."

"Together, we will work to continue advancing the industry-leading Roomba robots and smart home technologies that have defined the iRobot brand for more than three decades. By combining iRobot's innovation, consumer-driven design, and R&D with Picea's history of innovation, manufacturing, and technical expertise, we believe iRobot will be well equipped to shape the next era of smart home robotics."

Launched in 2002, Roomba became synonymous with robot vacuum cleaners, but its parent company's sales began lagging in 2023, with revenues plummeting since. By Q1 2025, it warned investors that it may not survive the year.

According to documents filed with the Securities and Exchange Commission in November, iRobot blamed the decrease in orders on "a decline in consumer sentiment and resultant spending."

For the quarter ending September 27, it recorded revenues of $145.8 million, which represented a $47.6 million, or 24.6 percent, decline from the previous year.

"Our revenue decreased as we continued to face market headwinds, ongoing production delays and unforeseen shipping disruptions which in turn increased cash usage and pressured profitability," the Form 10-Q [PDF] reads.

The company went on to note that it was significantly behind on its payments to Picea, its primary manufacturer in China and Vietnam. As of October 31, iRobot owed Picea $158.3 million, $29.1 million of which was past due.

It "conceded significant market share" in recent years, faced with increased competition and rising costs associated with US tariffs.

The 2024 collapse of iRobot's $1.7 billion buyout from Amazon also played a role in its financial difficulties. 

iRobot secured a three-year $200 million loan from the Carlyle Group in 2023 to refinance its business while the EU delayed the Amazon deal through its antitrust investigation. Much of this loan remains unpaid and was set to mature in July 2026.

In a Q1 letter to shareholders, iRobot said that it cut the company's headcount by half, in addition to reorganizing operations and investing in sales and marketing as a means of boosting the balance sheet. ®