However, shares of Allbirds have soared by a staggering 582% in a single trading session yesterday after the company made an announcement regarding a complete strategic makeover that will turn it into a company specializing in artificial intelligence services. Its share price climbed by as high as 875% during intraday trading before closing down to a lower level. The massive jump in its price was triggered by the news that the company would exit from its main business of producing footwear and completely focus on artificial intelligence.
The move from the company has been regarded as one of the most drastic moves ever made. For instance, the renowned maker of sustainable shoes known worldwide as Allbirds is planning to offload its shoe business activities altogether and shift its attention to become a GPU-as-a-Service company. This is a move aimed at developing the infrastructure needed to offer computing power to businesses interested in artificial intelligence applications. The timing of this move cannot be faulted since there is massive growth in the demand for AI computing power around the world.
This spike in share price underlines the tremendous interest that investors have in artificial intelligence plays. There is a prevailing bias in the market, especially in the United States, towards rewarding companies that associate themselves with AI-based growth themes without regard for any existing business model. As such, from an Indian investor point of view, this is just one of many instances where the valuation multiples are being determined by future stories rather than current financials. Such behavior has even been witnessed in some technology stocks listed on the NSE and BSE in India.
Nevertheless, there is cause for worry as the magnitude of this move suggests that it is primarily speculative. The fact that a stock can record gains of above 500% in a day does not imply anything about the underlying fundamentals of earnings expectations but simply speculation. In addition, it needs to be stated that Allbirds’ new direction entails becoming an intensive capital firm that requires capabilities in data centres, semiconductors, and cloud computing, all areas dominated by industry veterans.
Moving ahead, one needs to keep an eye on the asset sale, financing, and collaboration in the AI space. Around the world, AI continues to be a strong market theme, although sudden rallies based on sentiment can easily turn into bearish trends. This is a lesson for Indian investors to distinguish between value creation and speculation.
Investors should seek guidance from a SEBI-registered financial advisor prior to investing.
Reviewed for accuracy and last updated on April 16, 2026.
