iRobot Bankruptcy and Chinese Takeover Ends American Robotics Dream

The pioneering American robotics company iRobot filed for Chapter 11 bankruptcy on Sunday. This drastic step ends its 35-year run as an independent innovator. Its main Chinese supplier and lender, Shenzhen PICEA Robotics, will now take control.

The move follows a failed acquisition by Amazon and years of fierce competition. It marks a symbolic end for a company born from MIT labs that once dominated the home robotics market.

From MIT Labs to Mainstream Stardom

iRobot was founded in 1990 by MIT roboticist Rodney Brooks and his students. Their breakthrough product, the Roomba vacuum, launched in 2002. It became a cultural icon, selling over 50 million units worldwide.

The company went public in 2005. For years, it was the undisputed leader in its field. According to Reuters, it even launched its own venture fund in 2015 to invest in other robotics startups.

That confident era is now over. The bankruptcy filing was made in a Delaware court. The restructuring plan hands the company’s future to its Chinese supplier.

A Failed Deal and Mounting Debt

The company’s decline accelerated after a major deal collapsed. Amazon had agreed to buy iRobot for $1.7 billion in 2022. European regulators threatened to block it over competition concerns.

Amazon and iRobot called off the merger in January 2024. Amazon paid a $94 million breakup fee. iRobot’s founder and CEO, Colin Angle, resigned immediately after.

The company never recovered. It cut 31% of its workforce. It had been struggling with supply chain issues and cheaper Chinese rivals since 2021. A $200 million loan from The Carlyle Group in 2023 only delayed the inevitable.

The iRobot bankruptcy signals a major shift in the global home tech landscape. Once an American success story, its future now rests with Chinese manufacturing interests.

Thought you’d like to know

Will my Roomba stop working because of the bankruptcy?

No, not immediately. iRobot states current products will continue to function. The physical buttons on the device will always work for basic cleaning and docking. Cloud-dependent features like app control may be at risk long-term if services are shut down.

Who originally founded iRobot?

iRobot was founded in 1990 by MIT professor Rodney Brooks and his former students, Colin Angle and Helen Greiner. The company emerged from research at MIT’s Artificial Intelligence Lab focused on simple, practical robots.

Why did the Amazon deal fall through?

European Union regulators were prepared to block the $1.7 billion acquisition. They argued Amazon could stifle competition by degrading access to its online marketplace for rival vacuum brands. Facing this rejection, both companies terminated the agreement.

What happens to iRobot now?

Shenzhen PICEA Robotics, iRobot’s main supplier and a creditor, will take control of the reorganized company. The bankruptcy process is designed to keep the company operating, but its strategic direction will change under new ownership.

What caused iRobot’s financial troubles?

Two primary factors led to its decline. Aggressive competition from cheaper Chinese robot vacuum brands eroded its market share. Simultaneously, post-pandemic supply chain disruptions and rising costs severely impacted its profitability.