The deal announced Friday is also a continuation of Amazon’s business strategy to expand market share in various product categories through acquisitions. It snapped up Ring, which makes video doorbells and other smart home technology, in February 2018, and before that Blink, which makes connected cameras and doorbells for the home. It also stunned the grocery industry in 2017 when it announced the purchase of Whole Foods Market, a deal worth $13.7 billion.
(Amazon founder Jeff Bezos owns The Washington Post.)
The next generation of home robots will be more capable – and perhaps more social
The move comes just two weeks after Amazon announced it would buy primary care provider One Medical for $3.9 billion as part of a major expansion of the tech company’s healthcare ambitions. The tie-up, one of its largest acquisitions ever, gives Amazon a brick-and-mortar network of healthcare offices and providers and strengthens its existing healthcare portfolio, which includes an online pharmacy and Amazon Care, a virtual in-home emergency care. service.
Amazon’s offer of $61 per share represents a 22 percent premium over Thursday’s closing price of $49.99. On Friday, iRobot shares rose nearly 19.1 percent to close at $59.54.
“We know saving time is important, and tasks take up precious time that could be better spent doing something customers love,” said Dave Limp, senior vice president of Amazon Devices. “Over many years, the iRobot team has proven its ability to reinvent how people clean with products that are incredibly practical and inventive.”
Founded in 1990 by roboticists from the Massachusetts Institute of Technology, iRobot offers a range of automated vacuums and mops, as well as air purifiers and handheld vacuums. The signature Roomba, which sells for as much as $1,000, learns the contours and corners of floors and can detect objects, offers connectivity to WiFi networks and smartphones and can be summoned by voice-activated smart home devices. The company began trading on Nasdaq in 2005.
While a top name in home robotics, iRobot has had a rocky year. On Friday, the company reported second-quarter revenue of $255.4 million, down 30 percent from a year earlier. It reported a net loss of $43.4 million for the three-month period ended July 2.
The company also plans to move certain non-core engineering roles to low-cost regions as part of a cost-cutting plan, and lay off 10 percent of its workforce, about 140 employees, according to the earnings report.
The company has withdrawn the 2022 financial forecast it issued in May and, citing “ongoing disruptions and uncertainties that may affect the company’s outlook,” suspended providing any other guidance on future performance.
iRobot’s products, which map the floor plans of customers’ most intimate spaces, will complement Amazon’s product line that works by monitoring the home and the people in it.
What began as a microphone in a speaker has evolved into a growing genre of devices meant to make home life more enjoyable. Last September, at the company’s annual fall press event, Amazon unveiled a 15-inch wall-mounted version of the Echo Show display that watches and listens to your home, and a host of other products and services that all monitor consumers in some way. anticipate their needs.
The growth of such technology highlights consumers’ growing tolerance for sensors and cameras trained on their daily routines. This development has drawn criticism from privacy advocates and concerned consumers. It also underlines how technology giants see the home as yet another platform for a range of services and a goldmine of personal data.
Amazon will buy iRobot’s net debt under the terms of the deal, which will require approval from regulators and the robot maker’s shareholders. Colin Angle will continue as iRobot’s CEO.
Amazon shares fell 1.2 percent on Friday to close at $140.80, giving it a market capitalization of $1.4 trillion.
Last week, the Seattle-based giant reported its second straight quarterly loss — of $2.03 billion, or 20 cents a share — driven by a $3.9 billion write-down related to its investment in electric car startup Rivian Automotive, the Associated Press reported Pressure. But Amazon also recorded better-than-expected revenue of $121.2 billion during the second quarter.