By ByteBot
iRobot Corporation, maker of the iconic Roomba robot vacuum, filed for Chapter 11 bankruptcy yesterday (December 14, 2025), ending a 35-year journey from MIT innovation to consumer robotics pioneer. The Massachusetts-based company will be taken over by its Chinese supplier and creditor, Shenzhen PICEA Robotics, in a restructuring that wipes out existing shareholders and hands 100% control to the manufacturer it once depended on for production. The irony is brutal: iRobot was killed by the very supplier it relied on.
The Perfect Storm: Four Failures That Killed an Icon
iRobot’s collapse resulted from a devastating combination of regulatory roadblocks, market competition, trade policy chaos, and manufacturing dependency. Each factor alone was manageable; together, they proved fatal.
First, Amazon’s $1.7 billion acquisition – announced in August 2022 – died in January 2024 when EU Competition Chief Margrethe Vestager blocked the deal over concerns Amazon would “foreclose rivals by restricting access to its marketplace.” Amazon paid a $94 million breakup fee. iRobot CEO Colin Angle resigned, and the company cut 31% of its workforce. The lifeline was gone.
Second, Chinese competitors crushed iRobot’s market position. Roborock now commands 19.3% of the global market with 50.7% year-over-year growth. Nine of the world’s top 10 robot vacuum makers are Chinese. Together, Chinese brands control roughly 70% of the global market. iRobot’s premium pricing couldn’t compete with “good enough” alternatives that cost 70% less.
Third, tariffs demolished profitability. The company moved production from China to Vietnam to reduce tariff exposure. Then Vietnam rates jumped from 10% to 46%, costing iRobot $23 million in 2025 alone. No amount of geographic diversification could outrun unpredictable trade policy.
Fourth – and most damaging – iRobot owed its Chinese manufacturer $161.5 million for production ($90.9 million past due). When the Carlyle Group’s $200 million loan came due in late 2024, PICEA’s subsidiary bought that debt too. The manufacturer became the creditor, then the owner. Manufacturing dependency created an existential vulnerability that PICEA exploited perfectly.
Regulatory Backfire: EU Blocked Amazon, Enabled Chinese Control
The EU’s antitrust intervention had precisely the opposite effect regulators intended. They prevented a U.S. tech giant from acquiring an American robotics pioneer, worried about marketplace foreclosure and anti-competitive behavior. Instead, they cleared the path for a Chinese manufacturer to take 100% ownership through debt leverage.
The Information Technology & Innovation Foundation called this “An Antitrust Enforcement Blunder” in a November 2025 analysis, arguing regulators failed to consider geopolitical consequences. By blocking U.S. consolidation that might have competed with China’s manufacturing dominance, the EU inadvertently handed an iconic American robotics brand to the very competitors crushing its market share.
The regulatory timeline made matters worse. Seventeen months elapsed between deal announcement (August 2022) and termination (January 2024). During that limbo, iRobot couldn’t make strategic moves, lost key talent, and burned through cash. By the time the deal died, the damage was irreversible.
From MIT to Shenzhen: The 35-Year Arc
iRobot was founded in 1990 by MIT roboticist Rodney Brooks and students Colin Angle and Helen Greiner, commercializing breakthrough research from MIT’s AI Lab. The 2002 Roomba launch revolutionized consumer robotics, becoming not just a product but a cultural phenomenon: a verb, a meme, a cat-transportation device.
Over 35 years, the company sold more than 50 million robots. Now that journey ends with Chinese ownership, completing a shift from American innovation to offshore manufacturing to foreign control. The pattern is familiar: invent it in Cambridge, build it in Shenzhen, watch Shenzhen own it.
What Happens to Roomba Users?
iRobot promises “no anticipated disruption” – physical Roombas will continue working, app functionality maintained, customer support preserved. The restructuring, expected to complete in February 2026, keeps the company operational as a going concern under PICEA ownership.
However, long-term cloud services remain uncertain. Robot vacuums collect substantial mapping data about your home. That data now flows to Chinese-owned servers. Premium features like scheduling, room selection, and Alexa integration all depend on cloud infrastructure that PICEA inherits but hasn’t committed to maintaining long-term.
Key Takeaways: Manufacturing Dependency as Existential Risk
The iRobot bankruptcy teaches several brutal lessons for hardware companies:
Manufacturing dependency creates ownership risk. When you owe your supplier $161.5 million, they can become your owner. PICEA positioned itself as both manufacturer and creditor, then converted debt to equity through bankruptcy.
Antitrust enforcement can backfire geopolitically. The EU prevented an American acquisition to protect competition, enabling Chinese control instead. Sometimes blocking consolidation helps foreign competitors more than domestic markets.
Premium pricing fails against “good enough” commodities. iRobot’s engineering excellence couldn’t justify 70% price premiums when Chinese alternatives worked adequately. Quality alone doesn’t win commodity markets.
The U.S. doesn’t make things anymore – and that matters. American companies invent products, Chinese manufacturers build them, and eventually Chinese companies own them. iRobot is a case study; the pattern is structural.
