IRobot May Be IDead In IYear

Troubled robot vacuum-cleaner maker iRobot, abandoned by Amazon after regulators effectively doomed the web giant's takeover offer, has warned investors it may not survive the next 12 months.

The biz behind the Roomba admitted in its 2024 year-end financial results that its survival depends on the success of a new product lineup and securing additional financial support.

That said, iRobot warned, "there can be no assurance that the new product launches will be successful due to potential factors, including, but not limited to consumer demand, competition, macroeconomic conditions, and tariff policies."

"Given these uncertainties and the implication they may have on the company's financials, there is substantial doubt about the company's ability to continue as a going concern for a period of at least 12 months from the date of the issuance of its consolidated 2024 financial statements," it added. The date of issuance, we note, is today, March 12.

The potential demise follows Amazon abandoning its $1.7 billion takeover of the smaller firm early last year. The tech giant scrapped the deal after facing scrutiny from both US and European monopoly cops, who feared the merger could harm competition in the robot vacuum market.

iRobot noted in its statement today that, following Amazon's abandoned acquisition, it implemented significant restructuring measures. These included cutting more than 50 percent of its workforce, decreasing inventory and cash outflows, reducing costs by reorganizing its R&D and supply chain models, centralizing and consolidating its sales and marketing operations, and signing design and manufacturing partnership contracts.

• That's not a TP-Link access point, it's a… vacuum?
• Ex-director accuses iRobot of firing him for pointing out the home-cleaner droids broke safety, govt regulations
• Amazon's AI chips find their way into Astro butler bot, latest wall-hanging display
• Robot vacuum cleaner employed by Brit budget hotel chain Travelodge flees

"These collective actions contributed to a meaningful reduction in GAAP and non-GAAP operating expenses in 2024 compared with the prior year," iRobot noted, though they still apparently haven't been enough. 

While iRobot did reduce operating expenses over the past year, it still reported a net loss of $146 million for fiscal year 2024, which ended December 28. That's an improvement over fiscal 2023, which suffered a $305 million loss, but it continues to experience negative cash flow. As of the end of FY 2024 in December, iRobot had $134 million in cash and cash equivalents on hand.  

iRobot's revenue sank to $682 million last year from $891 million in FY 2023, a 23 percent plunge. In Q4 2024 alone, its revenue declined 47 percent in the US, 34 percent in Japan, and 44 percent in EMEA compared to the same period in 2023.

In addition to the drastic cost-cutting measures it's undertaken so far, iRobot said its board has kicked off a strategic review to explore alternatives, including refinancing of its debt, a "strategic transaction," or another possible sale. 

"There can be no assurance that the exploration of strategic alternatives will result in any agreements or transactions," iRobot said. 

The outfit wrapped up its statement by canceling its earnings call scheduled for today, and declining to provide a 2025 outlook. iRobot shares lost over a third of their value, slipping to just around $4 on the news amid turbulent market conditions.

We asked whether Amazon has been in talks for a second acquisition attempt, and iRobot declined to add anything beyond today's press release. Amazon hasn't responded to questions. ®