iRobot ($IRBT) Misrepresented Standalone Viability and Stability After Failed Amazon Merger Case

Court: S.D. New York

Case: 1:25-cv-05563

• IRBT investors filed a claim against iRobot for overstating its ability to operate profitably following the terminated Amazon acquisition, falsely promoting its restructuring plan, and failing to disclose severe financial and operational deterioration.
• After iRobot revealed a $172 million quarterly revenue, canceled earnings calls, IRBT stock fell 51.58% on March 12–13, 2025.
• IRBT investors can join this case to be notified about potential recovery.

Case Details:

From January 29, 2024, to March 11, 2025, iRobot claimed it was financially stable and strategically positioned after the collapse of its $1.7 billion Amazon acquisition. Executives announced the “iRobot Elevate” plan, which promised stabilization, cost alignment, and a path to profitability through new product launches and partnerships.

In reality, the company’s financial condition deteriorated sharply. Internal documents show losses far exceeding guidance, gross margins collapsing from 24–27% to just 9.5%, and $61 million in operating losses in Q4 2024. Executives also admitted to massive inventory write-offs and unsustainable supplier agreements.

Despite this, iRobot misrepresented the efficacy of its restructuring and failed to disclose severe risks to its viability. By March 2025, iRobot issued a “substantial doubt” statement about its ability to remain a going concern. The stock crashed over 51% in two days.

Based on these events, IRBT investors filed suit, alleging that iRobot:

• It misrepresented its ability to operate independently post-Amazon deal.
• It concealed its deteriorating financials and operational viability.
• It overstated the benefits of its restructuring and turnaround plans.

Investors claim iRobot misled the market to sustain its valuation during a critical transition.