Allbirds Inc (NASDAQ:BIRD) shares flapped over 200% higher after announcing a hard pivot from woollen sneakers to artificial intelligence infrastructure, enabled by a new $50 million convertible financing facility.
The company said the deal will fund plans to “pivot its business to AI compute infrastructure” and become a “fully integrated GPU-as-a-Service and AI-native cloud solutions provider”.
Yes, that is the same Allbirds, which IPOd in New York in 2021 as a $2.15 billion maker of eco-friendly sports shoes, sprinted to a $4.1 billion peak, but has since unravelled, with costly expansion into clothing and physical stores weighing on performance.
The latest move follows a deal at the end of last month to sell its intellectual property and operating assets to American Exchange Group for a fraction of its former value.
What remains will be an AI-focused business, with plans to rebrand as NewBird AI, swapping shoes for servers.
Initial funding will be used to acquire high-performance chips to rent out as computing power for artificial intelligence workloads.
Investors who stay on will hold shares in the new entity, while others will receive a dividend linked to the asset sale, marking a clean break from one of the more unlikely pivots in recent corporate memory.
The shares zoomed 238% higher on Wednesday morning to $8.42.