GoKawiilTim Brown, co-founder and co-chairman of sports shoe manufacturer Allbirds, speaks on stage at the OMR Festival digital trade show, May 10, 2023.
Allbirds made a surprising announcement Wednesday that it is pivoting from shoes to artificial intelligence.
The move boosted shares of the miniscule market cap company — it was valued at about $21 million at Tuesday's close — by 582%. The shares, which were under $3 a day ago, jumped to about $17.
The company announced that it's pivoting its business to AI compute infrastructure in a release posted to its investor relations page.
The company, which according to the release will be called NewBird AI, announced a deal to raise up to $50 million in funding, expected to close in the second quarter of 2026.
"The Company will initially seek to acquire high-performance, low-latency AI compute hardware and provide access under long-term lease arrangements, meeting customer demand that spot markets and hyperscalers are unable to reliably service," the company said in the announcement.
Allbirds, once a Wall Street darling valued north of $4 billion, announced a deal with American Exchange Group to sell its intellectual property and other assets for $39 million last month.
American Exchange Group is a brand management company focused on the accessory space. According to the release, it will continue to sell products under the Allbirds brand.
Allbirds closed all its U.S. full-priced stores in February.