Roomba maker iRobot files for bankruptcy as tariffs drive up costs

Roomba vacuum cleaners revolutionized the user robotics marketplace successful the aboriginal 2000s. Now the American institution down them has gone bankrupt, partially due to the fact that of President Donald Trump’s tariffs.

Massachusetts-based iRobot filed for bankruptcy extortion connected Sunday and said it would manus implicit power to its main Chinese supplier, Shenzhen Picea Robotics. It cited increasing contention from lower-priced rivals and rising costs from tariffs arsenic cardinal reasons.

Most of iRobot’s devices for the American marketplace are made successful Vietnam. But the state was deed by 46% import duties arsenic portion of Trump’s tariff regime, causing iRobot's costs to balloon by $23 cardinal this year. The levies besides made it much hard to program for the future, the institution said.

Founded successful 1990 by engineers from MiT, iRobot started retired focusing connected defence and abstraction enactment earlier pivoting to vacuum cleaners. The Roomba came retired successful 2002 and roseate to astir 42% marketplace stock successful the U.S. and 65% successful Japan.

The institution generated astir $682 cardinal successful gross past year, but it has been forced to little prices and summation spending connected improvement amid progressively pugnacious contention from different robot vacuum cleaner manufacturers, specified arsenic China’s Ecovacs Robotics.

As precocious arsenic 2021, it was valued astatine $3.56 billion, aft the pandemic caused a spike successful request for its products. The adjacent year, Amazon made an connection to bargain the institution that could person changed its fortunes, but the European Union halted that woody due to the fact that of contention concerns. Now iRobot valued astatine conscionable $140 million, according to the bankruptcy filing.

The institution warned successful firm filings past period that bankruptcy could beryllium successful the cards. iRobot owes $352 cardinal to Chinese supplier Shenzen Picea Robotics, and astir $91 cardinal of that is past due. Picea volition get 100% of the equity involvement successful iRobot, which volition let the institution to support operating, it said Sunday. The iRobot app, proviso chains, and merchandise enactment functions are expected to proceed uninterrupted.