Amazon Scrapped Its Deal to Buy iRobot. Now the Roomba Maker Is Filing for Bankruptcy.

Roomba maker iRobot declared bankruptcy on Sunday. (Justin Sullivan/Getty Images)

Key Points

• iRobot filed for Chapter 11 bankruptcy and will be acquired by its primary supplier, Picea, after a failed Amazon deal.
• iRobot owes Picea $352 million, with nearly $91 million of that debt currently past due.
• iRobot’s stock plummeted 78% to 95 cents, reflecting a market capitalization drop from $4.53 billion to $137.5 million.

iRobot filed for Chapter 11 bankruptcy and agreed to be taken over by its main supplier on Sunday, meaning that the Roomba maker will go private nearly two years after a deal with Amazon.com fell apart.

The Massachusetts-based consumer robotics company said in a statement that it would enter a restructuring agreement giving primary contract manufacturer Picea 100% of the equity interests in the company. It owes $352 million to Picea and nearly $91 million of that debt is past due, according to iRobot.

iRobot stock plummeted 78% to 95 cents ahead of Monday’s opening bell. The move caps a dramatic fall from grace for the company—iRobot’s market capitalization has plunged from a peak of $4.53 billion in January 2021 to $137.5 million at Friday’s close.

Created with Highcharts 9.0.1iRobot StockSource: FactSetAs of Dec. 12, 4 p.m. ET

Created with Highcharts 9.0.12025Dec.024681012$14

Intense competition from abroad and tariffs have been among the macroeconomic headwinds that have hit iRobot in recent years. Amazon scrapped its $1.7 billion deal to buy the company in January 2024, citing regulatory pushback from the European Union.

The good news for Roomba owners is that iRobot doesn’t expect the devices to “brick”—referring to when tech stops working after a company goes under.

Consumers have been asking what will happen to their robot, if the app will still work, and if the warranty will stay in place, iRobot’s senior director of corporate communications Michèle Szynal said.

“Yes, yes, and yes: It is business as usual,” she told Barron’s. “iRobot is here to stay, and we expect no disruptions to our operations.”

Like iRobot, Picea makes robotic vacuum cleaners, operating out of China and Vietnam. iRobot expects to complete the pre-packaged chapter 11 process by February 2026.

Write to George Glover at george.glover@dowjones.com