Amazon Pursued Roomba's Parent Once, But Now The Company's Robot Vacuums Face Heat From Chinese Rivals With AI-Powered Arms

Once a potential acquisition target for Amazon.com, Inc. AMZN, iRobot Corp IRBT — the maker of Roomba — is now playing catch-up to hold its ground against Chinese competitors.

What Happened: iRobot, the company behind the iconic Roomba vacuum, is facing mounting pressure from Chinese tech manufacturers such as Roborock, Ecovacs, Xiaomi Corporation XIACY, and Dreame Technology, reported Nikkei Asia.

Once considered the undisputed leader in the robot vacuum market, iRobot's global market share has dropped from 35% in 2015 to just 22% in 2023, according to Euromonitor.

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Beijing-based Roborock unveiled a new robot vacuum at CES 2025 featuring an AI-powered arm capable of picking up objects weighing up to 300 grams. The vacuum can recognize 108 objects out of the box, with room to program 50 more via app.

In Japan, where Roomba holds a 70% market share, Chinese rivals are rapidly gaining ground. Ecovacs is undercutting Roomba by nearly 30% with comparable features, while Xiaomi is preparing to launch robot vacuums in its new retail stores.

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Why It's Important: On Wednesday, it reported a 44% year-over-year drop in fourth-quarter sales, totaling $172.03 million, surpassing the analyst consensus forecast of $171.00 million.

The company revealed significant uncertainty about its ability to sustain operations for at least 12 months following the release of its consolidated 2024 financial statements.

Due to these circumstances, it has canceled the fourth-quarter earnings call that was set for March 12, 2025, and is refraining from issuing a financial outlook for 2025 at this time.

Price Action: IRBT shares surged 21.11% on Friday, closing at $3.70. However, they dipped 0.27% in after-hours trading at the time of writing. Year-to-date, the stock has declined 53.46%, according to Benzinga Pro data.

Photo Courtesy: DestinaDesign on Shutterstock.com

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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.