Allbirds Inc shares jumped more than 700% in one day after the company said it is moving into artificial intelligence. The stock closed at $17.96, up from $2.49, with heavy trading volume of 164 million shares. The price moved between $6.11 and $18.63 during the day. The sharp rise was mainly due to investor excitement around AI, not the company’s past business performance.
Allbirds said it will stop selling shoes and fully exit its consumer business. It plans to rename itself “NewBird AI” and focus on AI infrastructure. Instead of footwear, the company will invest in high-performance computing hardware and provide AI-related services.
Footwear business sold to American Exchange Group
The company has agreed to sell its brand and footwear assets to American Exchange Group for $39 million. The buyer will continue selling products under the Allbirds name. The deal is expected to close in the second quarter of 2026, subject to shareholder approval. After this, Allbirds will be fully separated from its original business.
Funding secured to build AI operations
To support this transition, Allbirds has signed a $50 million funding deal with an institutional investor. Chardan is acting as the placement agent. The deal is expected to close in the second quarter of 2026, pending shareholder approval at a meeting planned for 18 May. The money will be used to buy high-performance GPUs and build AI computing capacity.
“The Company will initially seek to acquire high-performance, low-latency AI compute hardware and provide access under long-term lease arrangements, meeting customer demand that spot markets and hyperscalers are unable to reliably service,” the company said in the announcement.
The company plans to offer GPU-as-a-Service and AI cloud solutions. It wants to grow its platform, build partnerships, and look at possible mergers and acquisitions to expand. The goal is to become a provider of AI computing power for businesses and developers.
Strong demand for AI driving the shift
Allbirds said demand for AI computing is very high right now. Data centres are nearly full, hardware takes longer to get, and most capacity is already booked until mid-2026. This makes it hard for companies to access the computing power they need, creating an opportunity for new players.
Shareholders may receive special dividend
After the sale of its footwear business, the company plans to give a special dividend to eligible shareholders. This is expected in the third quarter of 2026, subject to approvals.
Allbirds was founded in 2015 by Tim Brown and Joey Zwillinger. It became known for eco-friendly shoes made from natural materials like merino wool. Its first product, the Wool Runner, became very popular, especially among tech workers.
The company went public in 2021 and was once valued at over $4 billion. But its business slowed down as competition increased and costs rose. Sales fell nearly 50% between 2022 and 2025, dropping from $298 million to $152 million. It also closed all its full-priced US stores in February. Now, the company is betting on AI to rebuild its future.
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