Allbirds sells shoe business, pivots to GPU-as-a-Service

On Wednesday, Allbirds announced that it has sold its footwear brand and assets to American Exchange Group for $39 million. Because the footwear brand name was included in the sale, the company is rebranding as NewBird AI. The company plans to pivot its operations to become a provider of GPU-as-a-Service—a cloud computing model providing access to graphics processing units—and AI-native cloud solutions.

To support this new direction, the rebranded company secured a $50 million investment from an undisclosed institutional investor. The funding is structured as a convertible financing facility, which is a type of debt that can be converted into equity. NewBird AI plans to use the new financing to acquire GPU assets, which it will offer to customers seeking AI compute capacity. Over time, the company hopes to grow its service offerings through partnerships and strategic mergers and acquisitions, should those opportunities arise.

However, the transition is not yet finalized. Both the financing and the asset sale are subject to stockholder approval, with a stockholder meeting planned for May 18. If the sale is approved, stockholders will receive a dividend during the third quarter. Following the transition, American Exchange Group will continue to manufacture products for Allbirds customers, while NewBird AI focuses entirely on its technology pivot.

This strategy allows the company to utilize its existing public company’s shell—a publicly traded entity used to facilitate a new business operation—which has traded on the Nasdaq stock exchange under the ticker symbol “BIRD.” By maintaining this shell, the company can quickly enter the active artificial intelligence sector. The pivot represents an extreme shift for a brand whose shoes were once a staple among the Silicon Valley technology community.

The move is reminiscent of a corporate pivot in 2017, when the Long Island Iced Tea company rebranded to focus on blockchain. That announcement triggered a 275% stock jump, though the Nasdaq eventually delisted the company the following year after the market fever cooled. While Allbirds-turned-NewBird is likely hoping for a different outcome, it is executing a highly unusual corporate maneuver to capture AI demand.

Why it matters

This pivot highlights the extreme measures some public companies are taking to capitalize on the artificial intelligence boom. By utilizing an existing public shell, a consumer brand can rapidly transition into a high-demand infrastructure sector like GPU-as-a-Service.