Allbirds shares surge over 550% after pivot to AI business

Shares of Allbirds surged more than 550% in early New York trading on Wednesday after the company announced plans to exit its footwear business and reposition itself as an artificial intelligence infrastructure provider.

The company said it has entered into a definitive agreement to sell its brand and footwear assets to American Exchange Group. The transaction is expected to close in the second quarter of 2026, subject to shareholder approval.

Following the sale, Allbirds plans to rebrand as NewBird AI and focus on providing AI compute capacity, according to the company statement.

To support the transition, the company secured a $50 million (€42.4 million) convertible financing facility from an institutional investor. Chardan is acting as placement agent on the deal, which is also expected to close in the second quarter.

The proceeds will be used to acquire graphics processing units (GPUs), enabling the company to offer dedicated AI compute services under long-term agreements.

The company said it intends to distribute a special dividend to eligible shareholders after completion of the asset sale, effectively separating its legacy footwear operations from the listed entity.

The strategic shift comes amid strong demand for AI infrastructure, driven by increased enterprise spending and limited availability of high-performance computing capacity.

Data centre utilisation rates in key markets remain elevated, while procurement timelines for advanced hardware continue to lengthen, tightening supply conditions.

Shares of Allbirds reacted sharply to the announcement, reflecting investor interest in AI-related business models.

Analysts, however, said the transition carries execution risks, as the company moves away from its core consumer business into a highly competitive and capital-intensive sector.