Shares of Allbirds soared by nearly 400% on Wednesday after the company announced an unexpected pivot from footwear to artificial intelligence infrastructure.
The company said it plans to transform itself into an AI compute business under the proposed name “NewBird AI”, marking a dramatic departure from the sustainable footwear brand that once became synonymous with Silicon Valley consumers.
The stock was trading at $12.22 in early trade, up 390.76% on the day, giving the company a market capitalisation of roughly $20 million.
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In a statement released on its investor relations page, the company said it had secured a deal to raise up to $50 million in funding, which is expected to close in the second quarter of 2026.
“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,” it said.
The move comes weeks after Allbirds agreed to sell its intellectual property and other assets for $39 million to American Exchange Group, which is expected to continue operating the Allbirds footwear label.
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The funding raised for NewBird AI is expected to be used to buy high-performance GPU hardware for long-term leasing arrangements aimed at enterprises and AI developers facing shortages in compute capacity.
The company's transformation marks a remarkable turnaround for a business that, until recently, had been preparing to wind down following years of falling sales and intensifying competition in the footwear market.
Notably, from a 12-month view, Allbirds' stock is up 153%, whereas the rise is of 183.13% in 2026 so far.
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