[Christian Harris]

iRobot’s stock plunged 35% on Wednesday after the company issued a stark warning about its ability to continue operating, citing “substantial doubt” about its survival over the next 12 months.

The Roomba maker’s financial struggles stem from mounting debt, declining revenue, and fierce competition in the robotic vacuum market, which has been exacerbated by Amazon’s decision to abandon its $1.7 billion acquisition deal in January 2024.

The company’s fourth-quarter results painted a grim picture, with revenue plummeting 44% year-over-year to $172 million and net losses widening to $77.1 million.

This marks a significant downturn for a company that once dominated the robotic vacuum sector but has since been outpaced by Chinese competitors like Roborock and Ecovacs, which offer advanced features at lower prices.

In response to its financial crisis, iRobot has initiated a strategic review, exploring options such as debt refinancing, asset sales, or even a potential acquisition.

This comes just one day after the company launched eight new Roomba models in an effort to revitalise its product lineup and regain market share.

However, iRobot acknowledged that there’s no guarantee these new products will succeed, given factors like weak consumer demand, tariff uncertainties, and intense competition.

The collapse of the Amazon deal has been particularly damaging.

Amazon’s acquisition was seen as a lifeline for iRobot, offering financial stability and access to Amazon’s vast ecosystem.

However, regulatory scrutiny over antitrust concerns and data privacy issues led to the deal’s termination, leaving iRobot to navigate its challenges alone.

Since then, the company has laid off 51% of its workforce and implemented cost-cutting measures, but these efforts have not been enough to offset its losses.

iRobot’s current debt burden includes a $200 million loan from The Carlyle Group, which it amended in 2024 to secure temporary relief.

However, this waiver expires in May 2025, and if iRobot fails to extend it or secure alternative financing, it could default on the loan.

The company’s struggles highlight broader challenges in the smart home industry, where market saturation and aggressive competition are squeezing margins for established players.

While iRobot’s new product launches and strategic review offer a glimmer of hope, the company’s future remains uncertain.

Investors and consumers alike are left wondering if the once-dominant Roomba brand can stage a comeback or if it will become a cautionary tale in the rapidly evolving tech landscape.

What’s your take—can iRobot turn things around, or is this the beginning of the end for the Roomba maker? 🤔📉

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