Roomba maker IRobot filed for bankruptcy and will go private after being acquired by its Chinese supplier Picea Robotics.

Founded 35 years ago, the Massachusetts company pioneered the development of home vacuum robots and grew to become one of the most recognizable American consumer brands.

Over the years, it lost ground to Chinese competitors with less-expensive products. This year, the company was clobbered by President Trump’s tariffs. At its peak during the pandemic, IRobot was valued at $3 billion.

The bankruptcy filing, which happened on Sunday, has raised fear among Roomba users who are worried about “bricking,” which is when a device stops working or is rendered useless due to a lack of software updates.

The company has tried assuaging the fears, saying that it will continue operations with no anticipated disruption to its app functionality, customer programs or product support.

The majority of IRobot products sold in the U.S. are manufactured in Vietnam, which was hit with a 46% tariff, eroding profits and competitiveness of the company. The tariffs increased IRobot’s costs by $23 million in 2025, according to its court filings.

In 2024, IRobot’s revenue stood at $681 million, about 24% lower than the previous year. The company owed hundreds of millions in debt and long-term loans. Once the court-supervised transaction is complete, IRobot will become a private company owned by contract manufacturer Picea Robotics.

Today, nearly 70% of the global smart vacuum robot market is dominated by Chinese brands, according to IDC, with Roborock and Ecovacs leading the charge.

The sale of a famous household brand to a Chinese competitor has prompted complaints from Silicon Valley entrepreneurs and politicians, citing the case as a failure of antitrust policy.

Amazon originally planned to acquire IRobot for $1.4 billion, but in early 2024, it terminated the merger after scrutiny from European regulators, supported by then-Federal Trade Commission Chair Lina Khan. IRobot never recovered from that.

The central concern for the merger was that Amazon could unduly favor IRobot products in its marketplace, according to Joseph Coniglio, director of antitrust and innovation at the think tank Information Technology and Innovation Foundation.

Buying IRobot could have expanded Amazon’s portfolio of home devices, including Ring and Alexa, he said, bolstering American competition in the robot vacuum market.

“Blocking this deal was a strategic error,” said Dirk Auer, director of competition policy at the International Center for Law & Economics. “The consequence is that we have handed an easy win to Chinese rivals. IRobot was the only significant Western player left in this space. By denying them the resources needed to compete, regulators have left American consumers with fewer alternatives to Chinese dominance.”

“While IRobot has become a peripheral player recently, Amazon had the specific capacity to reverse those fortunes — specifically by integrating IRobot into its successful ecosystem of home devices,” Auer said. “The best way to handle global competition is to ensure U.S. firms are free to merge, scale and innovate, rather than trying to thwart Chinese firms via regulation. We should be enabling our companies to compete, not restricting their ability to find a path forward.”

California lost jobs for the fourth consecutive month in September — and it’s expected to add only 62,000 new jobs next year as high taxes drag on business formation, according to a report released Thursday.

The annual Chapman University economic forecast released Thursday found that the state’s job growth totaled just 2% from the second quarter of 2022 to the second quarter of this year, ranking it 48th among all states.

That matches California’s low ranking on the Tax Foundation’s 2024 State Business Tax Climate Index, which measures the rate of taxes and how they are assessed, according to the Gary Anderson Center for Economic Research report by the Orange, Calif., school.

The state also experienced a net population outflow of more than 1 million residents from 2021 to 2023, with the top five destinations being states with zero or very low state income taxes: Texas, Arizona, Nevada, Idaho and Florida, the report noted.

What’s more, the average adjusted gross income for those leaving California was $134,000 in 2022, while for those entering it was $113,000, according to the most recent IRS data on net income flows cited by the report.

“High relative state taxes not only drive out jobs, but they also drive out people,” said the report, which expects just a 0.3% increase in California jobs next year leading to the 62,000 net gain.

More unsettling, the report said, was a “sharp decline” in the number of companies and other advanced industry concerns established in California relative to other states, in such sectors as technology, software, aerospace and medical products.

California accounted for 17.5% of all such establishments in the fourth quarter of 2018, but that dropped to 14.9% in the first quarter of this year. Much of the competition came from low-tax states, the report said.

California saw the number of advanced industry establishments grow from 89,300 to 108,600 from 2018 through this year, but low-tax states saw a 52.2% growth rate from 164,000 to 249,600 establishments, it said.

Also on Thursday, the U.S. Bureau of Labor Statistics released its monthly states jobs report, which had been delayed by the government shutdown. It, too, showed California had a weak labor market with the state losing 4,500 jobs for the month, edging up its unemployment rate from 5.5% to 5.6%, the highest in the nation aside from Washington, D.C.

The state has lost jobs since June as tech companies in the Bay Area and elsewhere shed employees and spend billions of dollars on developing artificial intelligence capabilities.

There have also been high-profile layoffs in Hollywood amid a drop-off in filming, runaway production to other states and countries, and industry consolidation, such as the bidding war being conducted over Warner Bros. Discovery. The latter is expected to bring even deeper cuts in Southern California’s cornerstone film and TV industry.

Michael Bernick, a former director of California’s Employment Development Department, said such industry trends are only partially to blame for the state’s poor job performance.

“The greater part of the explanation lies in the costs and liabilities of hiring in California — costs and especially liabilities that are higher than other states,” he said in an emailed statement.

Nationally, the Chapman report cited the Trump administration’s tariffs as a drag on the economy, noting they are greater than the Smoot-Hawley Tariff Act of 1930 thought to have exacerbated the Great Depression.

That act only increased tariffs on average by 13.5% to 20% and mainly on agricultural and manufactured products, while the Trump tariffs “cover most goods and affect all of our trading partners.”

As a consequence, the report projects that annual job growth next year will reach only 0.2%, which will curb GDP growth.

The report predicts the national economy will grow by 2% next year, slightly higher than this year’s 1.8% expected rate. Among the positive factors influencing the economy are AI investment and interest rates, while slowing growth — aside from tariffs and the jobs picture — is low demand for new housing.

The report cites lower rates of family formation, lower immigration rates and a declining birth rate contributing to the lower housing demand.

The battle between California and the White House escalated as President Trump signed an executive order to block state laws regulating artificial intelligence.

The president’s power move to try to take over control of the regulation of the technology behind ChatGPT through an executive order Thursday was applauded by his allies in Silicon Valley, who have been warning that many layers of heavy-handed rules and regulations were holding them back and could put the U.S. behind in the battle to benefit most from AI.

The order directs the attorney general to create a task force to challenge some state AI laws. States with “onerous AI laws” could lose federal funding from a broadband deployment program and other grants, the order said.

The Trump administration said the order will help U.S. companies win the AI race against countries such as China by removing “cumbersome regulation.” It also pushes for a “minimally burdensome” national standard rather than a patchwork of laws across 50 states that the administration said makes compliance challenging, especially for startups.

“You have to have a central source of approval when they need approval. So things have to come to one source. They can’t go to California, New York and various other places,” Trump told reporters at the Oval Office on Thursday.

California Gov. Gavin Newsom pushed back against the order, stating it “advances corruption, not innovation.”

“They’re running a con. And every day, they push the limits to see how far they can take it,” Newsom said in a statement. “California is working on behalf of Americans by building the strongest innovation economy in the nation while implementing commonsense safeguards and leading the way forward.”

The dueling remarks between Newsom and Trump underscore how the tech industry’s influence over regulation has increased tensions between the federal government and state lawmakers trying to place more guardrails around AI.

While AI chatbots can help people quickly find answers to questions and generate text, code, and images, the increasing role the technology plays in people’s daily lives has also sparked greater anxiety about job displacement, equity, and mental health harms.

The order heavily impacts California, home to some of the world’s largest tech companies such as OpenAI, Google, Nvidia and Meta. It also jeopardizes the $1.8 billion in federal funding California has received to expand high-speed internet throughout the state.

Some analysts said Trump’s order is a win for tech giants that have vowed to invest trillions of dollars to build data centers and in research and development.

“We believe that more organizations are expected to head down the AI roadmap through strategic deployments over time, but this executive order takes away more questions around future AI buildouts and removes a major overhang moving forward,” said Wedbush analyst Dan Ives in a statement.

Facing lobbying from tech companies, Newsom has vetoed some AI legislation while signing others into law this year.

One new law requires platforms to display labels for minors that warn about social media’s mental health harms. Another aims to make AI developers more transparent about safety risks and offers more whistleblower protections.

He also signed a bill that requires chatbot operators to have procedures to prevent the production of suicide or self-harm content, though child safety groups removed support for that legislation because they said the tech industry successfully pushed for changes that weakened protections.

States and consumer advocacy groups are expected to legally challenge Trump’s order.

“Trump is not our king, and he cannot simply wave a pen to unilaterally invalidate state law,” state Sen. Steve Padilla (D-Chula Vista), who introduced the chatbot safety legislation that Newsom signed into law, said in a statement.

In addition to California, three other states — Colorado, Texas and Utah — have passed laws that set some rules for AI across the private sector, according to the International Assn. of Privacy Professionals. Those laws include limiting the collection of certain personal information and requiring more transparency from companies.

The more ambitious AI regulation proposals from states require private companies to provide transparency and assess the possible risks of discrimination from their AI programs. Many have regulated parts of AI: barring the use of deepfakes in elections and to create nonconsensual porn, for example, or putting rules in place around the government’s own use of AI.

The order drew both praise and criticism from the tech industry.

Collin McCune, the head of government affairs at venture capital firm Andreessen Horowitz, said on social media site X that the executive order is an “incredibly important first step.”

“But the vacuum for federal AI legislation remains,” he wrote. “Congress needs to come together to create a clear set of rules that protect the millions of Americans using AI and the Little Tech builders driving it forward.”

Omidyar Network Chief Executive Mike Kubzansky said in a statement that he is aware of the risks posed by poorly drafted rules, but the solution isn’t to preempt state and local laws.

“Americans are rightly concerned about AI’s impact on kids, jobs, and the costs imposed on consumers and communities by the rapid development of data centers,” he said. “Ignoring these issues through a blanket moratorium is an abdication of what elected officials owe their constituents — which is why we strongly oppose the Administration’s recent executive action.”

Investors seemed unimpressed by the possible boost the sector could get from the White House.

The stock market fell sharply on Friday, led by AI shares.

Bloomberg and the Associated Press contributed to this report.