iRobot’s third quarter results surged as online orders jumped along with retail sales as demand for Roomba and Braava robots remained strong.
The company is looking to become a smart home platform with the launch of its Genius Home Intelligence system. As previously reported, iRobot is looking to be more of a software platform for the smart home using data from its fleet of robots.
For the third quarter, iRobot reported revenue of $413.1 million, up 43% from a year ago. Premium robot sales were up 86%. The company reported third quarter net income of $3.27 a share and $2.58 a share non-GAAP.
Wall Street expected iRobot to report third quarter revenue $314.7 million with non-GAAP earnings of $1 a share.
In prepared remarks, iRobot CEO Colin Angle said the company saw strong demand.
As a result of the excellent progress we made this past quarter and growing confidence in the strength of expected fourth-quarter orders from our retail partners, our outlook has materially improved from our last update in late July.
The strength in third quarter 2020 revenue reflected another quarter of substantially stronger-than-expected orders from retailers tied to favorable sell-through trends, anticipated demand for the upcoming holiday season and incremental orders to support certain customer events, as well as robust direct-to-consumer sales growth.
For the year, iRobot projected non-GAAP earnings of $3.43 a share to $3.53 a share with revenue between $1.36 billion to $1.37 billion. Analysts were modeling 2020 non-GAAP earnings of $2.57 a share on revenue of $1.23 billion.
In the third quarter, iRobot launched its Roomba i3+ as well as the Root rt0 Coding Robot. iRobot also was a leading product during Amazon Prime Day.
The US business delivered 75% revenue growth in the third quarter with EMEA up 22% and Japan up 12%.
Angle said that the company is looking to nurture the lifetime value of customers, boost direct sales and create a market for refurbished Roombas. Angle said:
Nurturing the lifetime value of our customers is another strategic priority that we believe will support continued growth of our direct-to-consumer sales channel, the development of new recurring revenue streams and improved profitability.
We are starting to see early returns on some of the initial investments that we’ve made to improve the buying experience on our digital properties. For example, we’ve recently added support for a broader range of payment types, optimized the design of the homepage and elsewhere on irobot.com to increase conversion, personalized various promotional programs and added a new Roomba Restore program that promotes the sale of refurbished Roomba robots. Earlier this month, we began conducting smaller scale pilots of new services that we expect to refine and scale during 2021.
