There’s been a lot of interesting news at iRobot (NASDAQ:ROBOT) over the past few days, especially around Amazon (NASDAQ:AMZN: 906866). The tech octopus wants to buy the much smaller company for $1.7 billion. If nothing else intervenes, this should end this growth story for investors.
At the same time, iRobot’s management reported weaker quarterly figures and in this context announced that 10% of the employees would be laid off. In turn, we should be able to attribute this to the current market and economic situation.
However, there is something that should make us investors sit up and take notice: Apparently, the company itself plans to remain independent of Amazon in the future. Here are the details of an interesting statement.
iRobot: Still independent from Amazon?
The statements made by the management of iRobot can be seen in a causal connection with the takeover by Amazon and the layoffs. Management says the layoffs have no connection with the takeover. It is necessary to position yourself better operationally and to save costs. A longer statement has tried to define a bit of clarity here.
The following statement by the management of the US robotics company is interesting in this context:
The job cuts are entirely separate from Amazon’s announcement on Friday. Amazon was not involved in iRobot’s decision to reduce its workforce, and the two companies continue to operate independently.
It is the connotation that matters here. iRobot is still defining its independence. It could also be an indicator for the future that Amazon initially leaves the US company isolated in the overall group. At this point, that’s just speculation. Basically, I don’t think the management of the tech octopus with the gargantuan stock market valuation has any interest in acquiring a $1.7 billion company for its revenue growth potential.
Especially since there are synergies between iRobot and Amazon. In the field of home robotics, the tech octopus already has access to many living rooms with Alexa. Other home robots are likely to be in the foreground in the future. After all, this is a consumer goods market that will be larger in the future and can be reached with it.
I wouldn’t bet on independence
iRobot and Amazon makes sense to me in many ways. However, I believe investors shouldn’t bet on too much independence. The listed independence should be a thing of the past anyway once the purchase is complete.
But my guess is that the management of the tech group is also pursuing a strategic, operational target dimension. The acquisition fits on many fronts. Especially when it comes to valuable future technologies that the Kraken company can use.