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

You would be forgiven for missing this news. I quite managed not to see it myself amid the buzz of Amazon acquisition news last week on Friday (knowing a nod to Robot Report for pointing it out). Later that day, in its quarterly earnings report, iRobot announced plans to cut 140 jobs, a figure that represents about 10% of its global workforce.

Here is the full note from the filing:

To better align its cost structure with near-term revenues, iRobot is in the process of initiating a restructuring of its operations, which is expected to generate net savings of approximately $5-10 million in 2022 and approximately 30-40 millions of dollars. million in 2023. As part of the restructuring, the company is accelerating actions to move certain non-core engineering functions to lower-cost regions and increasingly leverage its co-design and manufacturing partners (JDM); better balance global and regional sales and marketing resources to support go-to-market plans while improving efficiencies and realizing economies of scale; realign other operational areas to better meet current business needs; and reduce the footprint of its global facilities. The actions are expected to result in a net reduction of approximately 140 employees, representing 10% of the company’s workforce as of July 2, 2022.

This latest round is double the number of layoffs the company laid off at the start of the pandemic, laying off 70 employees in April 2020. At the time, the company announced the delay of its long-awaited Terra robot lawn mower – a product that has not yet surfaced. Although CEO Colin Angle strongly suggested to me that the product is coming soon, as the company is looking to offer significant product diversification beyond Roomba.

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

At the very least, however, it seems likely that the company is scrambling to line up its ducks ahead of plans to integrate into Amazon’s consumer offering. The second quarter revealed that the company faced 39% EMEA, 29% US and 18% Japan, compared to the same period last year, when Roomba sales saw a nice increase as consumers spent more time at home. In the earnings report, iRobot explains that the reductions will help the company “execute its product roadmaps, optimize inventory levels across all major channels, grow DTC sales, and position the company for profitable growth in 2023”.

The company is far from the only one to have experienced layoffs this year. In fact, they are rapidly becoming more the rule than the exception amid severe economic headwinds. Getting taken over by a giant like Amazon is definitely a quick way to ensure that your business suddenly has some serious financial muscle behind it. As we get closer to the expected closing of the acquisition, we should have a fuller picture of what the brand will look like under this umbrella. One of the open questions is how much Amazon plans to invest in existing plans to expand iRobot’s portfolio.