The US firm behind the Roomba smart vacuum cleaner, iRobot, has filed for bankruptcy protection after facing competition from Chinese rivals and being hit by tariffs.
Under the so-called pre-prepared chapter 11 processthe main manufacturer of its devices, Shenzhen-based Picea Robotics, will take over the firm.
The difficult business environment has forced iRobot to cut prices and make major investments in new technology, according to documents filed Sunday.
US import tariffs of 46% on goods from Vietnam, where most iRobot devices for the US market are made, have increased costs by $23 million (£17.2 million) this year, the company said.
The money-losing company was valued at $3.56 billion in 2021 after the pandemic boosted demand for its products. Its value is now estimated at approximately $140 million.
iRobot shares fell more than 13% on Friday on tech-heavy Nasdaq in New York.
iRobot said the bankruptcy filing will not impact its app, supply chain or product support.
Founded in 1990 by three members of the Massachusetts Institute of Technology (MIT) artificial intelligence lab, iRobot initially focused on defense and space technology before releasing Roomba in 2002.
According to the company, Roomba has about 42% of the robot vacuum cleaner market in the United States and 65% of the Japanese market.
Last year, a deal was planned to take over online retail giant Amazon for $1.7 billion. thwarted by the European Unioncompetition watcher.
US trade tariffs imposed by Donald Trump on goods brought into America from abroad have increased costs for many businesses, including iRobot, whose products rely on imports.
Trump argued that import taxes would boost American employment and industry.
Picea is a robot vacuum cleaner manufacturer with R&D and production facilities in China and Vietnam.
The company has more than 7,000 employees worldwide and has sold more than 20 million robot vacuum cleaners.
