Allbirds, a former Wall Street darling fallen on hard times, looks to AI
for its future
[April 16, 2026] By
ANNE D'INNOCENZIO and MATT O'BRIEN
NEW YORK (AP) — Allbirds, the eco-friendly shoe brand that found its way
onto the feet of tech CEOs and movie stars before falling on hard times,
is pivoting to artificial intelligence.
On Wednesday the San Francisco-based company said it had signed a
definitive agreement with an unnamed institutional investor for $50
million in financing to shift its business to AI infrastructure. It will
also have a new name: NewBird AI. It plans to use the proceeds to
purchase graphics processing units, known as GPUs. The transaction is
expected to close during the second quarter of this year.
“The rise of AI development and adoption has created unprecedented
structural demand for specialized, high-performance compute that the
market is struggling to meet,” the company said in the release. “NewBird
AI is being built to help close that gap.”
The drastic change of direction has some industry watchers scratching
their heads.
“On the surface, it’s a strange pivot,” said AI infrastructure expert
Bill Kleyman. “I’ve been in this industry a while, and a company like
Allbirds moving from shoes into AI infrastructure is not a very natural
adjacency.”
It’s unclear how Allbirds will reinvent itself as a “GPU-as-a-service”
business that rents out computing power to AI companies. That means
selling access to a huge number of graphics processors, or other
specialized AI computer chips designed by companies like Nvidia or AMD,
that operate in big data centers typically run by cloud computing giants
like Amazon or Oracle.
The business of running physical AI infrastructure “requires access to
GPUs in a constrained market, long-term power agreements, advanced
cooling strategies, and a credible operating model,” said Kleyman, CEO
and co-founder of Apolo.
The announcement comes more than two weeks after Allbirds sold its
intellectual property and certain other assets and liabilities to
American Exchange Group, a leader in accessories design, licensing and
manufacturing, for $39 million. The company owns such retail brands as
Aerosoles, White Mountain, Jonathan Adler and Ed Hardy.
That's a dramatic fall from the Allbirds' peak in valuation at $4
billion in late 2021. The company had said that it would not be issuing
its quarterly earnings report that was set for March 31.
[to top of second column] |
In this July 21, 2018, file photo Allbirds co-founder Tim Brown
speaks at OZY Fest in Central Park in New York. Online shoe brand
Allbirds plans to more than double its store count next year, hoping
to reach shoppers who want to touch and try on their wool shoes.
(Photo by Evan Agostini/Invision/AP, File)
 The latest development marks a
dramatic departure from when the company was founded in 2015 by
former professional soccer player Tim Brown and renewable resources
expert Joey Zwillinger. Its mission: to create footwear from natural
material, not synthetics. A year later, Allbirds launched its iconic
wool runner shoe. But the company overexpanded, like many dot.com
brands that opened physical stores. And many consumers lost
interest.
In February, the brand shuttered most of its remaining stores to
focus on e-commerce, partnerships with stores and international
distributorship. It still operates two outlet stores in the U.S. and
two full-price stores in London.
Shares of Allbirds soared more than 600% on Wednesday’s news and
were hovering nearly $18 in late afternoon trading. A few days ago,
the stock was trading at $3. It once traded at $520 per share.
Kleyman said the stock market surge looks “more like initial
excitement and speculative momentum tied to anything AI rather than
validation of execution.”
Kleyman also noted that $50 million is not a lot to enter into an
infrastructure-heavy market and added that it seems everybody wants
to be an AI company.
“Some of those shifts are real and strategic,” he said. “Others feel
more reactive. In this case, I think it’s fair to say it can come
across as a bit desperate. The underlying business struggled, and AI
presents a compelling narrative reset.”
The attempt at a pivot shows that the demand for AI computing power
is real, “but so is the hype,” said Jim Piazza, who worked on
computing infrastructure at social media giant Meta and now is the
chief AI officer at IT services firm Ensono.
Piazza said building a real AI infrastructure business “takes deep
capital, technical expertise and disciplined execution,” something
that is already “crazy hard for tech-savvy companies” and will be
“an impossible challenge” for someone outside of it.
——
AP Technology reporter Matt O'Brien reported from Providence, Rhode
Island.
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