Unbelievable 600% rally in one day! Allbirds shares skyrocket as sneaker-maker plans AI pivot

Shares of Allbirds surged a whopping 582% in just one session after the American wool sneaker-maker announced plans to completely pivot its business from a shoe-maker to an AI compute infrastructure company.

After closing at $2.49 in the previous session, the Nasdaq-listed company's shares surged massively to close at $16.99 apiece on Wednesday. During the session, the stock exploded as much as 876% to hit an intraday high of $24.31 apiece.

Sneakers to AI: All about Allbirds' pivot

San Francisco-based Allbirds is known for its shoes made of natural materials like merino wool and eucalyptus. However, Allbirds on Wednesday announced a full pivot to AI compute infrastructure. It plans to rebrand as NewBird AI, announced a $50 million deal to start buying GPUs.


"Allbirds Inc. today announced the execution of a definitive agreement with an institutional investor for a $50 million convertible financing facility. The facility, which is expected to close during the second quarter of 2026, will enable the company to pivot its business to AI compute infrastructure," the company said in a press release.

"The rise of AI development and adoption has created unprecedented structural demand for specialised, high-performance compute that the market is struggling to meet. Global enterprise spending on AI services and data center investment are on the rise. At the same time, GPU procurement lead times are increasing for high-end hardware, North American data center vacancy rates have reached historic lows, and market-wide compute capacity coming online through mid-2026 is already fully committed," it said, explaining the rationale behind the move.

This comes after the company, on March 30, sold its brand and all footwear assets to American Exchange Group—the firm behind Ed Hardy and Aerosoles—for $39 million. This is nearly 1% of the $4 billion valuation it commanded during its 2021 Nasdaq debut.

Under the new plan, which is subject to shareholders’ approval, the company will use the $50 billion convertible financing facility to acquire high-performance GPU hardware. It will then lease access to that hardware under long-term arrangements, targeting enterprises and developers that it claims hyperscalers and spot markets are leaving behind.

The pivot marks a sharp shift from the company’s founding sustainability principles to an AI compute business. This reminds investors of Long Island Iced Tea’s pivot to blockchain in 2017, rebranding itself as Long Blockchain Corp, following which the stock had surged 500%. The stock was eventually delisted in 2021, and the US SEC later charged three people with insider trading.

Attempt to capitalise on AI movement

"It looks like an attempt to capitalise on the AI movement. I don't see how Allbirds brings anything ⁠to the table beyond name recognition," Reuters quoted Bruce Winder, an independent retail consultant, as saying.

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The latest pivot comes as Allbirds has been reportedly shutting most of its offline stores over the last few months amid muted demand and a shift to online partnerships, before selling off its shoe business. The shift to artificial intelligence-linked business comes amid overall robust investor enthusiasm for AI-related stocks and the data-centre infrastructure that supports it, hoping to benefit from the hundreds of billions of corporate investment pouring ⁠into the ‌technology.

(With inputs from agencies)

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