iRobot to Cut Jobs as Quarterly Results Exceed Expectations
On the surface, it sounds like a bad joke. iRobot (NASDAQ: IRBT) has reported quarterly financial results that far exceeded expectations, and yet it is still cutting jobs in its military division. Is this a case of an employee manufacturing his or her own replacement? “Hey Bob, is that robot finished yet?” “Uh. No boss. Not yet.”
Well, no. The truth is that the government has implemented cutbacks in military R&D spending, leading to an inevitable reduction by iRobot in the military unit.
The Boston Business Journal said today that there are 55 planned job cuts at its three facilities in Bedford, Mass., Durham, N.C., and San Luis Obispo, Calif. “Third quarter revenue grew 28 percent over the third quarter of 2010 to $120.4 million. For the first nine months of 2011, iRobot reported that revenue is up 17 percent to $334.7 million. Net income for the quarter was $14.1 million, double the number for the same quarter in 2010, while income for the first nine months was $29.6 million, up from $18.5 million in 2010.”
Benzinga contacted Matthew Lloyd, Director of Communications, for comment. He said that, “We can confirm that iRobot Corporation has had a reduction in force. This difficult action was taken based on our current view of future defense spending and a shift in program structure. In 2012 we see a significant decrease in our externally funded research and development.”
“This transition from development to production requires our Government and Industrial robot division to reduce the size of its workforce,” said Lloyd. “The reduction accounted for approximately 8 percent of the total workforce. At this point we can confirm that 55 full time employees from our Bedford, MA; Durham, NC and San Luis Obispo, CA offices were impacted by the reduction in force. 44 of these employees were based in Massachusetts.”
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