iRobot Files for Bankruptcy as Shares Plunge More Than 70%
iRobot Corporation, globally known as the maker of Roomba robotic vacuum cleaners, filed for Chapter 11 bankruptcy protection.
Quick overview
- iRobot Corporation has filed for Chapter 11 bankruptcy and will become a privately held company after being acquired by Picea Robotics.
- The restructuring process is expected to be completed by February 2026, allowing iRobot to continue normal operations without disruptions.
- As part of the restructuring, iRobot's common shares will be delisted, resulting in current shareholders receiving no equity in the reorganized company.
- The bankruptcy follows years of financial challenges, including increased competition and the failure of a planned acquisition by Amazon.
The outcome of the robot maker’s restructuring will also mean that iRobot’s common shares will stop trading on the stock market.
iRobot Corporation, globally known as the maker of Roomba robotic vacuum cleaners, filed for Chapter 11 bankruptcy protection in a Delaware court and announced that it will become a privately held company following an acquisition by its main manufacturing partner and lender, Picea Robotics.
Chapter 11 is a financial restructuring mechanism under U.S. bankruptcy law that allows companies to reorganize their debts and operations under court supervision while continuing to operate.
In this case, iRobot reached a Restructuring Support Agreement (RSA) with its secured lender and manufacturing partner, Shenzhen PICEA Robotics, along with its affiliate Santrum Hong Kong. Under the agreement, Picea will acquire 100% of iRobot through the restructuring process.
Roomba maker files for bankruptcy
The company expects the largely prepackaged process—meaning key terms were agreed in advance with creditors—to be completed by February 2026.
Under the RSA, Picea will receive full ownership of the company, eliminating iRobot’s debt and significantly reducing its financial burden, allowing the reorganized business to continue normal operations.
During the restructuring, iRobot said it will continue operating as usual, including the functionality of its products (such as Roomba apps and device support), customer service programs, relationships with global partners, and its supply chain, with no anticipated disruptions.
A streamlined company
As part of the restructuring, iRobot’s common shares will be delisted and canceled, meaning current shareholders will receive no equity in the reorganized company and no recovery on their investment if the plan is approved by the court. As a result, shares trading on Nasdaq plunged more than 70% on the day.
The bankruptcy filing follows several years of financial challenges for the company. Founded in 1990, iRobot was a pioneer in the household cleaning robot market but has faced intensifying competition from lower-cost Chinese manufacturers offering more advanced features, as well as pressure from tariffs on products made in Asia.
The company also struggled after the collapse of a planned acquisition by Amazon in 2024, which ultimately failed to materialize.
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