Allbirds shares soar 600% as it pivots from footwear to AI

By Allison Morrow, CNN

New York (CNN) — Shares of Allbirds — the 2010s pioneer of trendy sneakers and eco-conscious Millennial retail marketing — took flight in an almost comical fashion Wednesday morning after the company announced an extremely 2026 pivot: abandoning its environmental agenda and getting into the AI business.

The stock, which had largely been in the gutter since a November 2021 peak that valued the company at $4 billion, shot up more than 600% in early trading Wednesday. The catalyst came from Allbirds’ announcement that the company, after selling its footwear assets and branding to brand management company American Exchange Group last month for just $39 million, would soon reemerge as a new entity with a focus on “AI compute infrastructure.”

Allbirds remains a shell of its former self: Its market value was $165 million midday Wednesday.

Allbirds’ wool-based sneakers quickly became a Silicon Valley wardrobe staple when the shoe line launched in 2016. The brand, like eyewear-maker Warby Parker and luggage-maker Away, became part of a stable of buzzy, venture capital-backed retailers that marketed and sold their wares directly to consumers.

But Allbirds stumbled as it grew rapidly. While it opened stores around the world, most of them didn’t move enough inventory to be profitable.

“Allbirds has gone from being a highflyer to a dead parrot,” GlobalData retail analyst Neil Saunders said in a note last month as the company was nearing a deal with American Exchange.

The reason for the lack of traction, Saunders wrote, was that Allbirds’ sustainability pitch “has never been a key consideration for most footwear consumers,” who are more concerned about style, price and comfort.

Allbirds, which will be renamed “NewBird AI,” said it executed a $50 million deal with an unnamed institutional investor to acquire “high-performance GPU assets” to begin transitioning into a “fully integrated GPU-as-a-Service” — essentially a company that rents out computing power to tech startups.

That’s not all that’s changing from Allbirds’ core mission. As part of the transition, the company disclosed in a filing with the Securities Exchange Commission that NewBird AI would be less focused on environmental conservation. As such, as part of a shareholder vote next month, it is asking for approval of a charter amendment to remove references to the company operating in service of that public benefit.

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