Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

How iRobot's 2nd Brushless Roomba Will Accelerate Sales

By Steve Symington - Mar 11, 2014 at 9:07AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

iRobot just released the second robotic vacuum to feature its new brushless cleaning system. Here's what you need to know.

When iRobot Corporation ( IRBT -1.82% ) unveiled the new Roomba 870 on Friday, I took a quick glance at a few of my favorite deal sites and forums to see what consumers were saying.

Curiously, most immediate responses seemed to share one common theme: confusion.

iRobot's new Roomba 870 retails for $599. Source: iRobot.

Apart from a slightly different color scheme, it's admittedly difficult to tell the difference between the new $599 bot and iRobot's four-month-old $699 Roomba 880.

Both are available exclusively on iRobot's website, both have the improved XLife battery, both have larger debris bins, and both feature iRobot's new brushless, maintenance-free "AeroForce" cleaning system, which is arguably the most significant upgrade since Roomba vacuums were first introduced more than 11 years ago.

So what is the difference? With the 880, the extra $100 gets you a remote control and the ability to "clean room-to-room" with iRobot's Virtual Wall Lighthouses. But if you don't mind skipping the remote and sticking with a couple traditional virtual walls -- which simply block your Roomba from entering any given area -- the 870 will do the trick while offering all the biggest core upgrades.

iRobot knows what it's doing
It might seem silly at first to make these simple distinctions, but iRobot is demonstrating a certain level of predictable brilliance here.

First, iRobot knew even with the steep price tag, early adopters of its new brushless bots would happily gobble up the 880 over the first few months. Sure enough, during last quarter's earnings conference call, CEO Colin Angle told investors sales of the 880 "have exceeded those of all other new products over the same time frame."

What's more, keep in mind the Roomba 800 series robots have yet to expand to other retail outlets. When that happens, it's not unreasonable to expect iRobot's sales to accelerate even more.

In the meantime, and now that early adopters have had their fill, the 870 should help iRobot grab more value-conscious consumers who still want the powerful new AeroForce system but don't need all the bells and whistles. I'm part of this group, and have to admit Friday's announcement has me not-so-secretly wishing my old Roomba 650 -- which still works fine, mind you -- will kick the bucket and give me an excuse to upgrade.

But that's not to say iRobot's older brush-based models don't have their place. Angle also told investors last month that robotic vacuums now represent around 15% of all vacuum cleaner sales. In case you're wondering how much more market share they can take, he says that's comparable to the rate of adoption achieved by both microwave ovens and dishwashers at the same stage in their respective life cycles.

Foolish takeaway
iRobot is currently calling for 2014 home robot sales to comprise 90% of total revenue after growing 17% to 20% over last year.  However, given iRobot's history of underpromising and overdelivering, I wouldn't be surprised if the Roomba 870 plants just the seed iRobot needs to once again beat expectations in the coming year.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

iRobot Stock Quote
iRobot
IRBT
$72.34 (-1.82%) $-1.34

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
624%
 
S&P 500 Returns
140%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/06/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.