Allbirds (NASDAQ: BIRD) surged more than 300% Wednesday after the former sustainable shoe brand announced a sharp pivot into AI compute infrastructure, two weeks after agreeing to sell its footwear brand and related assets for $39 million.
The company said it executed a definitive agreement with an institutional investor for a $50 million convertible financing facility, expected to close in Q2 2026. The proceeds are intended to fund a pivot into AI compute infrastructure, with Allbirds anticipating a name change to “NewBird AI.”
Allbirds said the new business will initially seek to acquire high-performance, low-latency AI compute hardware and lease access to customers under long-term arrangements. Its stated long-term goal is to become a fully integrated GPU-as-a-Service and AI-native cloud solutions provider.
Shares traded around $11.00 as of writing, up $4.14 from the previous close.
The pivot follows Allbirds’ March 30 agreement to sell its intellectual property and certain assets and liabilities to American Exchange Group for an estimated transaction value of $39 million, subject to adjustments. American Exchange is expected to continue operating the Allbirds brand.
The AI financing is not fully unconditional. Allbirds said conversion of the facility is subject to stockholder approval at a special meeting expected on May 18, 2026. The company also anticipates issuing a special dividend in Q3 2026, subject to approval of the asset sale.
The shift comes after a steep deterioration in the core shoe business. In Q3 2025, Allbirds’ net revenue fell 23.3% to $33.0 million from $43.0 million a year earlier. Net loss was $20.3 million, compared with $21.2 million in Q3 2024, while net loss margin widened to 61.6% from 49.3%.
Earlier 2025 results showed the same pattern. First-quarter revenue declined 18.3% to $32.1 million, while second-quarter revenue fell 23.1% to $39.7 million. Net losses were $21.9 million in Q1 and $15.5 million in Q2. 
Allbirds’ annual filing also flagged deeper pressure, with a 2025 net loss of $77.3 million and $55.1 million of cash used in operating activities, alongside going-concern risk.
