Intensified competition and heavy tariffs make self-rescue impossible! Siasun Robot & Automation, the originator of iRobot (IRBT.US), filed for bankruptcy and plummeted dramatically before the market opened.

Roomba floor-sweeping manufacturer Siasun Robot & Automation company iRobot (IRBT.US) submitted Chapter 11 bankruptcy protection application to the Delaware court in the United States last Sunday, indicating that it will go private after being acquired by its main manufacturer Picea Robotics. As a result of this news, iRobot's pre-market stock price on Monday plummeted by more than 82% at the time of writing. The company's market value reached 3.56 billion dollars in 2021 due to demand driven by the pandemic, but now it is only about 140 million dollars. According to iRobot's announcement, the company has reached a "Reorganization Support Agreement" with its secured creditors and major contract manufacturer Picea. Under the terms of the agreement, Picea will receive 100% of iRobot's shares, cancel the remaining 190 million dollars of debt due in 2023, and an additional 74 million dollars in debt owed by iRobot to Picea under their manufacturing agreement. Other creditors and suppliers will receive full payment. It is reported that Chapter 11 bankruptcy protection under the US Bankruptcy Code is a reorganization type of bankruptcy procedure for businesses, the core purpose of which is not to directly liquidate and close down businesses, but to provide companies in financial distress but still with operational value a chance to "breathe and be reborn". iRobot stated that this arrangement will significantly optimize iRobot's balance sheet, ensure the company can maintain normal operations, and retain its global business layout. The company's CEO Gary Cohen said, "This transaction will strengthen our financial position and ensure business continuity for consumers, customers, and partners." iRobot emphasized that during the bankruptcy proceedings, it will maintain normal business operations, and its application functions, customer service plans, global partnership relationships, supply chain collaborations, and in-progress product support will not be affected. To ensure business continuity, iRobot has submitted a series of routine motions to the court to ensure that the company can operate in the normal mode, including honoring commitments to employees and timely and fully paying off amounts owed to suppliers and other creditors before, during, and after the start of the proceedings. In addition, iRobot expects that if the court ultimately approves the Chapter 11 bankruptcy restructuring plan, existing common stock shareholders will not receive any equity in the reorganized company. All issued and outstanding shares of common stock will be canceled, and common stock shareholders will face full losses without receiving any compensation. In 2022, Amazon.com, Inc. (AMZN.US) planned to acquire iRobot for approximately 1.7 billion dollars in cash, but abandoned the deal in January 2024 due to regulatory scrutiny. Since then, iRobot has struggled to generate cash flow and repay debt. In March of this year, the company warned that there were "significant doubts" about its ability to continue operating and has been seeking to sell itself. In October of this year, iRobot disclosed in a regulatory filing that the only remaining potential buyer had withdrawn after a "long period of exclusive negotiations", indicating that the company's last chance for salvation had been completely blocked. The Roomba series developed by iRobot officially entered the market in 2002, pioneering the category of home cleaning robots. Its products have sold millions worldwide, with a peak global market share of over 80%. However, as competition in the floor-sweeping industry intensified, iRobot's glory began to fade. When Chinese brands popularized laser navigation and automatic mopping technology, iRobot persisted with traditional visual navigation solutions, only introducing its first sweeping and mopping robot in 2022, more than five years later than Chinese brands. At the same time, its flagship products maintained prices over 1000 dollars, which is three times higher than similar products from Chinese brands. Meanwhile, although iRobot still dominates in key markets such as the United States and Japan, competition has forced it to lower prices and invest heavily in technology upgrades. In addition to increasing competition, US tariff policies have also put pressure on iRobot, especially the 46% tariffs imposed on imports from Vietnam (where iRobot produces its floor-sweeping robots for the US market). According to documents submitted by iRobot to the court, tariffs have increased the company's costs by 23 million dollars in 2025, making it more difficult to plan for the future. Data shows that as of September 27, iRobot had only 24.8 million dollars in cash and equivalents, with total liabilities of 508 million dollars and negative equity of 26.8 million dollars, leading to almost exhausted cash flow. In the third quarter of 2025, iRobot's revenue in the US market plummeted by 33%, with simultaneous declines in Europe and Japan. According to IDC data, in the first three quarters of 2025, global floor-sweeping robot shipments increased by 18.7% year-on-year, with Chinese brands taking the top five spots globally, while iRobot's share fell to 7.9% and was pushed out of the top five camp.