Allbirds lacks footing for dramatic AI pivot

Allbirds

15/04/2026 19:17

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

By Robert Cyran

NEW YORK, April 15 (Reuters Breakingviews) - After failing to sustain its eco-friendly sneaker empire, Allbirds BIRD.O has an even woolier proposition. The company, once valued at more than $4 billion, sold what remains of its footwear business last month for just $39 million, and is now racing into the world of artificial intelligence. These sorts of bizarre pivots work occasionally, but the odds are long.

Some modern corporate giants have sprouted from highly unusual seeds. South Korean smartphone and chip maker Samsung once exported dried fish while Nokia made the unlikely switch from rubber-boot manufacturing to wireless telecom. India's Wipro started by selling cooking oil before becoming an IT powerhouse. Shell is so named because of its origins as a collectibles shop where founder Marcus Samuel once sold decorative sea-creature coverings before it later commissioned the first oil tanker to traverse the Suez Canal.

Most such ambitious metamorphoses flop, however. They suffer from a lack of management skill, capital, luck, competition and myriad other factors. After all, defeat is the eventual fate for most ventures, and the bigger the gambit the lower the chance for success.

Jumping onto the latest bandwagon, as Allbirds is doing, also tends to be little more than a gimmick, or worse. The Long Island Iced Tea Corp, for example, attracted investors in 2021 after it rebranded as Long Blockchain to take advantage of cryptocurrency mania. Its shares were later delisted, and the Securities and Exchange Commission brought insider trading charges.

In addition to raising $50 million in convertible financing, Allbirds is playing the name game, too. It will now be known as NewBird AI, with a “long term vision to become a fully integrated GPU-as-a-Service and AI-native cloud solutions provider.” The microscopic stock price jumped 620% on Wednesday.

It’s unclear what the company brings to the crowded and heavily capitalized world of data centers. CoreWeave CRWV.O, for one, is worth 400 times as much, has close ties with Nvidia and just expanded chunky deals with Jane Street and Anthropic. Despite this progress, it is not clear what advantage it has over deep-pocketed and technologically advantaged rivals such as Microsoft MSFT.O and Amazon AMZN.O.

In this context, NewBird AI looks like a considerable longshot. Its shoes may have spread across Silicon Valley, but it will take more than a few dollars and a dream to get off the backfoot.

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CONTEXT NEWS

Allbirds, the former sneaker manufacturer, said on April 15 that it was raising $50 million in convertible financing to pivot to artificial intelligence compute infrastructure.

The company. which is changing its name to NewBird AI, said on March 30 that it had agreed to sell the Allbrands brand and footwear assets to American Exchange Group.

Allbirds shares were up 620% by 11:20 EDT.

Allbirds stock is more ashes than phoenix https://www.reuters.com/graphics/BRV-BRV/BRV-BRV/byprneknlpe/chart.png

(Editing by Jeffrey Goldfarb; Production by Maya Nandhini)

((For previous columns by the author, Reuters customers can click on CYRAN/robert.cyran@thomsonreuters.com; Reuters Messaging: robert.cyran.thomsonreuters.com@reuters.net))