Struggling Shoe Company Allbirds’ Stock Jumps 582% After it Says it’s an AI Business Now
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A sneaker company that recently lost 99% of its value has just made money for nothing. Allbirds, best known for its minimalist wool runners, saw its share price surge 582% in a single day after announcing its pivot to artificial intelligence. No new shoes. No turnaround plan. Just AI.
The company says it will rebrand as “NewBird AI” and shift its focus well away from its origins selling soft, sustainable sneakers to tech workers.
We wish we were joking, but there’s even a release to the market. The company is going to “pivot its business to AI compute infrastructure, with a long-term vision to become a fully integrated GPU-as-a-Service (GPUaaS) and AI-native cloud solutions provider,” the release says. Not a shoe in sight.
But here’s the kicker, none of that seemed to matter to the stock market.
Allbirds isn’t a healthy business expanding into a new category. It’s a struggling one trying to survive. Its valuation has collapsed from around $4 billion at its peak. Stores have been shut, and it’s already lined up a $39 million sale of its entire footwear business to a brand management firm. Even after the spike, the stock was still trading around the $20 mark.
We’re sitting here scratching our heads, wondering who’s even paying for all of this, and now they’re making a play for AI infrastructure? Where’s the bloke from The Castle when you need him?
Even the $USD50 million backing the move isn’t locked in yet. It’s all tied up in a convertible facility that still needs shareholder approval. And while that might sound like a lot of money, in AI infrastructure, it barely gets you in the room.
AI startups pulled in $73.1 billion in funding in just the first quarter of 2025, accounting for more than half of all global venture capital. Some companies are spending hundreds of millions just to secure access to GPUs. Perplexity AI, for example, reportedly committed around $750 million purely for compute.
Allbirds, with a measly $50 million, wants to enter that same part of the market. Can we tell them they’re dreaming now? And that’s before you get to the part that really doesn’t line up.
This is a company that built a good chunk of its identity around sustainability. Natural materials, low carbon claims, public benefit status. It even drew backing from Leonardo DiCaprio, who once called it a model for the footwear industry, while the likes of Gwyneth Paltrow, Oprah Winfrey and Barack Obama were all seen wearing them. Now it’s pivoting into one of the most energy-hungry industries on the planet.
And yet, that’s not far off what’s being traded here. Investors aren’t betting on whether Allbirds has built something new. It’s that it might.
It’s not even the first time we’ve seen this. Back in 2017, Long Island Iced Tea Company pivoted to blockchain, sent its stock flying, and never built a real business out of it. And right now, that speculation seems to be enough for investors.
Because even with a new name, a new story, and a short-term surge in attention and stock prices, actually building an AI infrastructure business is where this either holds up or pops like a balloon.
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