Allbirds, the San Francisco-based footwear company known for its sustainable merino wool sneakers, announced a dramatic pivot to artificial intelligence infrastructure on Wednesday, joining a growing list of firms across industries that are reinventing themselves to capitalize on the AI boom.
The company, which agreed last month to sell most of its assets for $39 million—a fraction of its former $4 billion valuation—said it would rebrand as NewBird AI and shift its focus entirely to acquiring and deploying graphics processing units (GPUs) for AI computing. An unnamed investor has committed $50 million to support the transition, according to a company statement.
“The rise of AI development and adoption has created unprecedented structural demand for specialized, high-performance compute that the market is struggling to meet,” the company said, adding that NewBird AI aims to close the gap for developers and research groups seeking computing resources.
Investors reacted sharply, sending Allbirds stock up more than 580% on the day of the announcement. However, shares remain more than 90% below their 2021 initial public offering price, reflecting the company’s steep decline as consumer preferences shifted and competition intensified.
Analysts have expressed skepticism about the pivot. “A $50 million investment is a drop in the bucket,” said Dylan Carden, specialty-retail analyst at William Blair, calling the move “a Hail Mary.” Retail analyst Hitha Herzog told the BBC that the excitement generated by “just by putting AI in an announcement” makes Allbirds “clearly a meme stock.”
Allbirds is not alone in its transformation. A broader wave of companies, particularly from the cryptocurrency sector, are repositioning themselves as AI infrastructure providers. Bitcoin miners such as Cipher Digital and Hut 8 are investing heavily in data-centre infrastructure, while MARA Holdings has sold about $1 billion worth of bitcoin to fund its AI shift. According to Bloomberg, publicly listed crypto miners are expected to generate the majority of their revenue from AI operations by the end of this year.
“The long-term economics of HPC and AI data centres should trump Bitcoin mining,” Brian Dobson, managing director at Clear Street, told Bloomberg. “Just from a business operations standpoint, you get more visibility, better margin and stronger cash flows.” Data from CoinShares projects AI could account for about 70% of combined revenue at listed miners by December, up from roughly 30% currently.
Early movers into AI infrastructure have been rewarded by investors. Firms such as TeraWulf, IREN Ltd., Cipher, and Hut 8 have secured multi-year agreements with major technology companies, including Google, Microsoft, and Anthropic, driving their shares to record levels. For context, Nvidia Lags AI Peers as Rotation to Memory, Infrastructure Plays Accelerates highlights the shifting dynamics in the AI hardware space.
Despite the enthusiasm, experts caution that not all pivots are grounded in sustainable strategies. Bill Kleyman, CEO of Apolo.us and an AI infrastructure expert, told the New York Times that many companies are turning to AI as a narrative reset rather than a carefully planned transformation. “Every company wants to be an AI company—some of those shifts are real and strategic, others feel a lot more reactive,” he said.
The Allbirds pivot underscores the intense pressure on legacy consumer brands to find new growth avenues in a market increasingly dominated by technology. As the AI infrastructure buildout accelerates, investors are watching closely to see which companies can execute on their ambitious plans. For a deeper look at how major financial institutions are leveraging AI, see Big Banks Post $55B Q2 Profit: AI Dealmaking and Trading Surge Fuel Record Earnings.
This article is for informational purposes only and does not constitute financial advice.
