Leading American robot vacuum cleaner manufacturer sells itself to China.

Having pioneered and dominated the robotic vacuum cleaner market, iRobot has had to file for bankruptcy due to post-Covid-19 problems and competitive pressure from younger rivals.

iRobot has just gone bankrupt after 35 years. Photo: Bloomberg .

iRobot, the company that revolutionized the robotic vacuum cleaner industry in the early 2000s with its Roomba product line, has filed for bankruptcy and proposed transferring control to its main supplier in China.

The giant collapsed.

According to a press release, Massachusetts-based consumer robot manufacturer iRobot will be acquired by Shenzhen PICEA Robotics Co. of China and a subsidiary of the group.

Following the acquisition, iRobot will become a private company with 100% of its shares owned by the new owner. The iRobot common stock currently listed on the NASDAQ will be delisted.

Founded in 1990 by engineers from the Massachusetts Institute of Technology (MIT), iRobot achieved initial success with the Roomba, launched in 2002 and quickly becoming an icon in the field of self-cleaning vacuums.

iRobot was once a pioneer and dominant player in the home robotic vacuum cleaner market. Photo: iRobot.

However, the company, which once sold more than 40 million home robots, began to see profits decline in the post-Covid-19 era due to supply chain issues and competition from cheaper rivals. Earlier this month, the company warned of the risk of bankruptcy.

According to the official statement, the bankruptcy plan allows iRobot to continue operating and fulfilling its commitments to employees, while making full and timely payments to suppliers and creditors throughout the court-supervised period. In the filing, the company listed assets and liabilities ranging from $100 million to $500 million .

"iRobot will continue to operate normally, without disrupting application functionality, customer programs, global partners, supply chain relationships, or ongoing product support," the statement said.

Lost after 35 years

According to Techcrunch 's commentary, iRobot's rise and fall is a very "quintessentially American" story. Founded in 1990 by MIT robotics researcher Rodney Brooks and his alumni, the bankruptcy ended a 35-year journey from AI researchers' dreams to the consumer's kitchen floor and ultimately into the hands of a Chinese company.

Brooks, the founding director of MIT's Computer Science and Artificial Intelligence Laboratory and a pioneer in robotics research, spent the 1980s observing insects and made fascinating discoveries about how simple systems could produce complex behaviors.

By 1990, he had translated that knowledge into the company iRobot. Roomba, launched in 2002, was a resounding success, dominating the entire robotic vacuum cleaner market. Sales reached tens of millions of units.

As a result, the company raised a total of $38 million before its initial public offering (IPO) in 2005, which brought in $103.2 million . By 2015, iRobot was strong enough to establish its own venture capital fund.

The market being flooded with cheap products is one of the reasons why iRobot has "lost its way". Photo: Vacuum Wars.

At the time, the initial plan was to invest between $100,000 and $2 million in up to 10 robotics startups in the seed and Series A rounds each year.

However, iRobot's business situation quickly reversed. Their profits declined sharply since 2021 due to supply chain disruptions and intense competition from cheaper Chinese rivals.

In 2022, e-commerce giant Amazon offered to acquire iRobot for $1.7 billion . In a press release, Angle, who has served as CEO since the company's inception, spoke of "creating innovative, practical products" and finding "a better place for our team to continue its mission."

But European competition authorities have threatened to block the takeover. They fear Amazon could eliminate competitors by restricting or reducing their access to the market.

Amazon and iRobot agreed to cancel the deal in January 2024. Amazon paid a settlement of $94 million . The incident led to the resignation of CEO Angle. iRobot's stock plummeted. The company cut its workforce by 31%.

Now, the journey of the original iRobot has come to an end after 35 years. Shenzhen PICEA Robotics, the supplier and main creditor, will take full control of the brand after restructuring.

Source: https://znews.vn/hang-robot-hut-bui-hang-dau-cua-my-ban-minh-cho-trung-quoc-post1611810.html