SAN FRANCISCO - Allbirds, Inc. (NASDAQ:BIRD) announced today the execution of a definitive agreement with an institutional investor for a $50 million convertible financing facility, according to a press release statement. The financing comes as the company, currently valued at just $21.68 million, trades at $2.49 per share -- down more than 60% over the past six months. According to InvestingPro data, the company is quickly burning through cash with negative free cash flow of $58.23 million over the last twelve months.
The facility, expected to close during the second quarter of 2026, will enable the footwear company to pivot its business to AI compute infrastructure. The company stated its long-term vision is to become a GPU-as-a-Service and AI-native cloud solutions provider. In connection with this pivot, the company anticipates changing its name to NewBird AI.
Conversion of the facility is subject to stockholder approval at a Special Meeting of Stockholders scheduled for May 18, 2026, for stockholders of record as of April 13, 2026.
The announcement follows the company's previously disclosed agreement to sell the Allbirds brand and footwear assets to American Exchange Group. Subject to stockholder approval of that asset sale, Allbirds anticipates issuing a special dividend during the third quarter of 2026 to stockholders of record as of May 20, 2026.
NewBird AI stated it expects to use initial capital from the facility to acquire high-performance GPU assets, which will be deployed to serve customers requiring dedicated access to AI compute capacity. The company said it will initially seek to acquire AI compute hardware and provide access under long-term lease arrangements. Despite recent stock volatility, InvestingPro analysis suggests the stock may be undervalued at current levels, with shares trading below the platform's Fair Value estimate.
Chardan is serving as placement agent on the facility and Holland & Hart LLP is acting as legal counsel to Allbirds.
The company cited market conditions including increasing GPU procurement lead times, historic low North American data center vacancy rates, and fully committed compute capacity coming online through mid-2026 as factors driving demand for AI compute resources.
In other recent news, Allbirds, Inc. has announced a significant transaction involving the sale of its intellectual property and certain other assets to American Exchange Group for an estimated $39 million. This agreement is subject to approval by Allbirds' common stockholders, with a proxy statement for the asset sale and potential company dissolution expected to be filed by April 2026. Additionally, Allbirds plans to close all its full-price stores in the United States by the end of February 2026 as part of a strategic move to enhance profitability. The company intends to focus on its e-commerce platform, wholesale partnerships, and international distributorships. Despite these closures, Allbirds will keep two outlet stores in the U.S. and two full-price stores in London operational. These developments reflect Allbirds' efforts to streamline operations and adapt to changing market conditions.