After axing 31 percent of its workforce when it failed to be acquired by Amazon, iRobot terminates another 16 percent of remaining staff
iRobot the maker of the Roomba vacuum cleaner, is axing more staff as part of its “ongoing restructuring” to help it with its “turnaround strategy.”
Techcrunch first noticed a regulatory filing with the Securities and Exchange Commission that confirmed the job losses. The filing stated that another 105 employees, or 16 percent of the workforce, will lose their jobs in the run up to the Christmas holiday period.
This is now the second tranche of job losses for the Bedford, MA-based firm. In January 2024, when Amazon abandoned its $1.4 billion (£1.1bn) purchase of iRobot in the face of opposition from EU regulators, iRobot said it would cut about 31 percent of its workforce (i.e. 350 staff) in a cost-cutting drive.
Operational restructuring
Now in the regulatory filing, iRobot has confirmed another tranche of layoffs.
“On November 5, 2024, iRobot Corporation announced it will implement an operational restructuring plan that is expected to include an overall reduction of approximately 105 employees,”the filing stated.
It said this represents 16 percent of the Company’s global workforce as of 28 September 2024.
The firm said it expects to record restructuring charges of approximately $5.3 million primarily relating to severance packages and related benefits, with the majority of the restructuring charges anticipated in the fourth quarter of 2024.
It said that as of 28 September 2024, iRobot had reduced its total headcount by 41 percent since year-end 2023.
Turnaround strategy
“We continue to make progress on our turnaround strategy,” said Gary Cohen, iRobot’s CEO in the company’s third quarter financial results, which revealed a profit of $7.3 million after a $59.5 million loss in the same period in 2023.
“In the third quarter, we expanded our non-GAAP gross margin by 590 basis points year over year and improved our use of operating cash,” Cohen stated. “However, our overall results did not meet the expectations we set in August, as persistent market segment and competitive headwinds impacted our sell-through performance. Although we now expect it will take more time to stabilise our revenue trend, we are on track to exceed our operating expense targets for the year, while at the same time continuing to invest in areas that are expected to drive growth.”
“Our ongoing restructuring has fundamentally changed the way we innovate, develop and build our robots, which is central to improving our performance and generating long-term shareholder value,” said Cohen. “With the benefit of lower operating costs, we expect to enhance margins and improve profitability in 2025.”
“As we move forward in this new chapter in iRobot’s history, one thing is abundantly clear: we have a powerful brand that will serve as the foundation for the turnaround of this Company,” he stated. “That brand power is at the heart of our turnaround strategy, iRobot Elevate. In executing that strategy, we are focused on providing our iconic brand with an improved platform to drive long-term profitable growth.”
CFO, HR retirement
The firm also announced a number of “executive transitions.”
Julie Zeiler, the company’s chief financial officer, and Russ Campanello, the company’s chief human resources officer, will retire on 2 December, but will stay on in advisory roles until 28 March 2025.
Karian Wong, iRobot’s senior VP and principal accounting officer, will succeed Zeiler as CFO, and Jules Connelly, the company’s former senior director of human resources, will succeed Campanello as chief human resources officer.