Allbirds, known for sustainable footwear popular among Silicon Valley professionals, announced it will exit the shoe business and shift to AI compute infrastructure. The company will rebrand as NewBird AI and focus on providing GPU-as-a-service by acquiring high-performance computing hardware and offering dedicated AI compute capacity to customers.
After the announcement, shares rose 582%, closing near $17 after trading below $3, and the company’s market value jumped from about $21 million to over $100 million in one session, reports CNBC. The stock then fell more than 20% the next day as momentum slowed.
The transition is supported by a $50 million convertible financing facility from a single institutional investor, rather than an equity raise. The facility is expected to close in the second quarter of 2026, pending stockholder approval. Convertible financing allows the investor to provide capital as debt that may later convert to equity, often at a discount, potentially diluting existing shareholders if conversion occurs.
NewBird AI plans to use the initial capital to acquire high-performance GPU assets, deploy them for customers needing dedicated AI compute capacity, and develop into a fully integrated GPU-as-a-Service and AI-native cloud solutions provider. The company aims to meet demand that larger cloud providers are not fully addressing, citing longer GPU procurement lead times and low vacancy rates in North American data centres.
In March, Allbirds announced the sale of its intellectual property and core footwear assets to American Exchange Group for $39 million. American Exchange Group, which specialises in licensed fashion and accessories brands, will continue to operate the Allbirds footwear brand. Allbirds had previously closed all its US full-priced stores in February.
Allbirds has no operational history in AI infrastructure, no disclosed customers, and no completed financing as of publication. Whether NewBird AI can establish a viable compute business, given its origins as a footwear brand, remains unproven.
