Allbirds Is Now an AI Company, and That Should Strike Fear Into Anyone Investing in Its Competition
2026-05-04 06:43:00 ET
Silicon Valley may have abandoned its favorite shoe company, but Allbirds (NASDAQ: BIRD) isn't abandoning Silicon Valley. The venture-capital-backed direct-to-consumer shoe company was once worth $4 billion. In March, the company sold its shoe brand for less than 1% of that value, $39 million.
But Allbirds is like a phoenix. From the ashes of its eco-friendly shoe business, it's emerging as an artificial intelligence (AI) company. A $50 million financing agreement will help it pivot into being an infrastructure-as-a-service cloud provider, similar to CoreWeave (NASDAQ: CRWV) or Nebius Group (NASDAQ: NBIS) . And it comes with a fancy new name: NewBird AI.
Allbird's stock got a massive pop when it made the announcement, growing by nearly sevenfold in value. And while the share price has settled significantly lower since the announcement, it's still up by about 167% from its pre-pivot price. The market's reaction to the news should put some fear in AI stock investors, especially those buying shares of businesses in the same line as NewBird. And not because the new competitor is a major threat to those more-established AI businesses, but because it says something about how investors are valuing them.
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