Could this signify the end of Roomba?
As per iRobot, the producer of the robotic vacuum, it could be a possibility.
iRobot depended on a $1.7 billion acquisition agreement with Amazon, which fell through due to regulatory hurdles in January 2024. Since then, iRobot has been on the lookout for a buyer to alleviate its financial woes.
This Monday, iRobot disclosed in a regulatory filing with the SEC that talks with the last potential buyer have concluded, as reported by CNBC. The firm indicated that the bidder offered a “considerably lower” price per share compared to the existing trading price of the Roomba manufacturer’s shares.
In response to this news, iRobot’s stock plummeted by 33 percent.
“At present, we are not engaged in advanced negotiations with any other parties regarding a possible sale or strategic transaction,” iRobot mentioned in a regulatory filing with the SEC. “Therefore, there is no guarantee that our exploration of strategic alternatives will lead to any transaction or result.”
Once, Roombas were synonymous with robotic vacuums, but the firm has recently encountered heightened competition from brands like Shark. Shopping reporters from Mashable have discovered that Roombas frequently fall behind competing vacuums in performance evaluations. Additionally, robotic vacuums have progressed significantly, with new premium models now providing smart laser mapping, mopping, and self-cleaning features. Nevertheless, iRobot has found it challenging to match the competition in recent years.
iRobot has also battled substantial revenue issues and has struggled to manage its debts.
In July 2023, iRobot obtained a $200 million loan to sustain operations, expecting an acquisition by Amazon. Now, the company urgently needs to secure new funding, or it warns that it “may be compelled to drastically reduce or halt operations and would likely seek bankruptcy protection.”
This recent turn of events isn’t entirely surprising.
When the company revealed its financial situation in March, iRobot cautioned that it could shut down within a year. It appears that not much has shifted since March, apart from the fact that we are now significantly nearer to that one-year mark.