iRobot announced a 10% staff cut the same day its Amazon news dropped

You’d be forgiven for missing this bit of news. I fully cop to not seeing it myself amid the buzz of last week’s Amazon acquisition news on Friday (knowing nod to Robot Report for pointing it out). Later that day, inside its quarterly earnings report, iRobot announced plans to cut 140 jobs — a figure that amounts to roughly 10% of its global workforce.

Here’s the full note from the filing:

To better align its cost structure with near-term revenue, iRobot is in the process of initiating a restructuring of its operations, which is expected to deliver net savings in the range of approximately $5 million to $10 million in 2022 and approximately $30 million to $40 million in 2023. As part of the restructuring, the company is accelerating actions to shift certain non-core engineering functions to lower-cost regions and increasingly leverage its joint design manufacturing (JDM) partners; better balancing global and regional commercial and marketing resources to support go-to-market plans while driving efficiencies and achieving economies of scale; realigning other operational areas to best support current needs of the business; and reducing its global facilities footprint. The actions are expected to result in a net reduction of approximately 140 employees, which represents 10% of the company’s workforce as of July 2, 2022.

This latest round is double the number the company laid off at the outset of the pandemic, dropping 70 employees in April 2020. At the time, the company announced the delay of its long awaited lawn mowing robot Terra — a product that has yet to surface. Though CEO Colin Angle strongly suggested to me that the product would be arriving soon, as the company looks to offer some meaningful product diversification beyond Roomba.

In a statement provided to TechCrunch, the company was quick to point out that the layoffs/restructuring was not a direct result of the recent Amazon news, noting, “The reduction in force is completely separate from Friday’s Amazon announcement. Amazon was not involved in iRobot’s decision to reduce its workforce, and the two companies continue to operate independently.”

At the very least, however, it seems likely that the company is working to get its ducks in a row ahead of plans to fold into Amazon’s consumer offering. The second quarter found the company facing a 39% EMEA, 29% in the U.S. and 18% in Japan, versus the same time last year, when Roomba sales saw a nice boost with consumers spending more time at home. In the earnings report, iRobot explains that the cuts will help the company in “executing on its product roadmaps, optimize inventory levels across all major channels, expand DTC sales and position the business for profitable growth in 2023.”

The company is far from alone in experiencing layoffs this year. In fact, they’re quickly becoming more the rule than the exception amid some serious economic headwinds. Certainly getting acquired by a giant like Amazon is a quick way to ensure your company suddenly has serious financial power behind it. As we push closer to the acquisition’s expected closing, we should get a fuller picture of precisely what the brand will look like under that corporate umbrella. One of the open questions is how much Amazon plans to invest in existing plans to grow iRobot’s portfolio.

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