Renowned for its sustainable wool sneakers, the San Francisco-based footwear brand Allbirds is redirecting its operations toward artificial intelligence. The firm intends to transform into a comprehensive GPU-as-a-Service operation and AI-focused cloud platform. Additionally, it is rebranding as NewBird AI.
The transition requires approval from shareholders, set for a vote on May 18. If successful, Allbirds will secure $50 million in funding from an undisclosed backer to support the initiative. These funds are earmarked for purchasing and generating revenue from graphics processing units, associated high-performance computing systems suitable for demanding tasks, and additional pertinent resources essential for launching an AI computing venture.
Historically recognized for its commitment to environmental sustainability in the shoe industry, Allbirds faces challenges in aligning AI operations with green practices. The company seeks shareholder endorsement for a charter revision that eliminates mentions of its dedication to environmental public benefit purposes, effectively dropping sustainability-focused identity elements.
Despite growing societal concerns over AI, investor enthusiasm for the sector remains high. News of Allbirds moving from a familiar decade-long expertise in footwear to an unfamiliar domain of AI computing propelled its share price upward by more than 400 percent. Analysts at the Financial Times predict this surge may not last and advise individual investors to exercise caution.
While unexpected and unconventional, this strategic redirection was perhaps inevitable for Allbirds amid its recent struggles. The company, which reached a peak valuation of about $4 billion in 2021, recently offloaded its core shoe operations and trademarks to a private equity group for a mere $39 million.
Allbirds joins a trend of firms adapting to meet surging AI demands. For instance, the aerospace startup Boom Supersonic, focused on developing supersonic passenger jets, has started supplying gas turbines for AI data centers. Similarly, former Bitcoin mining facilities have repurposed for AI workloads, and NVIDIA's graphics cards, originally designed for gaming, now dominate AI applications.