iRobot Files for Bankruptcy, Seeks to Assure Customers Roombas Will Keep Working
Mondeum Capital (UK) Limited
iRobot Corp., the maker of Roomba robotic vacuums, filed for bankruptcy on Sunday, saying its products will continue to operate normally as the company restructures its finances.
The Massachusetts-based company has struggled for years amid intensifying competition from overseas rivals offering cheaper — and in some cases more technologically advanced — autonomous vacuums. Its outlook worsened in 2024 after a proposed acquisition by Amazon.com Inc. collapsed due to regulatory concerns, sending iRobot’s shares sharply lower.
Founded in 1990, iRobot helped pioneer consumer robotics, with Roomba becoming one of the best-known household tech brands. Many of its newer models rely on cloud-connected software and mobile apps, prompting concerns among customers that the devices could stop functioning if the company were to fail.
iRobot sought to allay those fears, saying it does not expect any disruption to product support or app functionality during the restructuring process.
In recent regulatory filings, the company had warned that a bankruptcy was increasingly likely. iRobot said it owes about $352 million to Picea, its main contract manufacturer with operations in China and Vietnam, including nearly $91 million that is past due.
Under the restructuring plan outlined Sunday, Picea will receive 100% of the equity in iRobot, a move the company said would allow it to continue operating while addressing its debt obligations.
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