Roomba maker iRobot warns it may go out of business, sending shares plunging

Roomba vacuum cleaner maker iRobot, a former $1.4 billion buyout target of Amazon, raised concerns on Wednesday about its ability to stay in business.

Shares of the company fell more than 35%, extending a multi-year decline from its pandemic-era peak.

“Given macroeconomic and tariff-related uncertainties, there is substantial doubt about iRobot’s ability to continue as a going concern,” iRobot said in a statement.

The loss-making company was once valued at $3.56 billion in 2021, driven by pandemic-fueled demand. It is now worth less than $200 million.

The company’s net loss for the fourth quarter ended December 28, 2024, widened to $77.1 million from $63.6 million a year earlier. Its revenue declined by 44% in the fourth quarter.

The company’s cash reserves dwindled to $134.3 million in 2024, compared to $185.1 million in 2023. The debt stood at $200.6 million as of December 28, 2024, its annual filing showed.

The vacuum cleaner maker is having a hard time keeping up with Chinese rivals such as Ecovacs Robotics, which offer advanced features at lower prices.

The company said it was exploring options, including a potential sale or debt refinancing, just a day after it launched eight new Roomba models in its biggest product rollout.

In August 2022, iRobot had agreed to a $61-per-share takeover by Amazon, a deal some analysts viewed as a lifeline for the company and a potential enhancement for Amazon’s smart home division.

However, strong antitrust objections to the merger and privacy concerns over the spatial data collected by the devices led to the deal’s collapse in January last year.

With the takeover scrapped, founder Colin Angle stepped down as CEO in January last year, suggesting that a leader with turnaround expertise might better serve the company.

In May last year, the company appointed Gary Cohen as CEO to head its recovery efforts.