Allbirds is ditching its history as an environmentally conscious company

• Allbirds is pivoting from sustainable footwear to AI compute infrastructure.
• The company plans to be less focused on environmental conservation, according to an SEC filing.
• Allbirds' stock price surged 582% after the company announced it was transitioning to AI.

Allbirds isn't only pivoting to AI — it's pivoting away from its core environmental principles.

Once dubbed the favorite shoemaker of Silicon Valley, Allbirds announced Wednesday it was transitioning from footwear to AI compute infrastructure and becoming NewBird AI.

The company said it planned to buy GPUs, or powerful chips, and become a GPU-as-a-service company. It's also selling off its footwear assets and its original name, meaning Allbirds-branded shoes could continue to be made, under new ownership.

The company partially answered questions about what that might mean for Allbirds' status as a company committed to ESG — environmental, social, and governance principles — in a filing with the Securities and Exchange Commission.

The filing said stockholders would vote next month on proposed changes to the company, including removing environmental commitments written into its charter and revoking its status as a public benefit corporation. PBCs are for-profit corporations intended to produce a public benefit and operate responsibly and sustainably.

"The anticipated Electronics Infrastructure Business would be less focused on the public benefit of environmental conservation," the company said.

Allbirds said in the filing that there were risks associated with some of the proposed changes to its charter, including ceasing to operate as a Delaware PBC, which requires the company to "produce a public benefit and operate in a responsible and sustainable manner."

"Eliminating that status could damage our reputation, adversely affect our ability to attract and retain customers, employees and partners, and negatively impact our business, financial condition and results of operations," the filing said.

If the amended charter is accepted, the company said, it would operate "in the best interests of our stockholders, without balancing the best interests of our stockholders against the public benefit of environmental conservation."

Allbirds did not respond to a request for comment from Business Insider.

The transition to AI is an especially striking move for Allbirds, given concerns about the environmental impacts and resource consumption of AI. An investigation by Business Insider found the AI and data center boom is straining power grids and water supplies across the US.

Allbirds was founded as a sustainable footwear company

When Allbirds started out in 2015, sustainability was central. The company touted its shoes, made from what it said were natural, sustainable materials, as better for people and the environment.

In 2016, the company earned its B Corp certification, given to companies that meet specific standards for social and environmental impact. It also became a PBC.

When Allbirds went public in 2021, the company said in an SEC filing that its mission was to "make better things in a better way, through nature — products that people feel good in and feel good about."

"We aim to reverse climate change through better business by empowering people to make better, more conscious decisions for themselves as well as the planet," the company said, adding, "We are proud of the alignment of financial and environmental benefits from our work, and that we are able to serve as a driving force in a new age of sustainable enterprise."

Last year, the company said it had made the "world's first net zero carbon shoe" with its limited edition "M0.0NSHOT Zero," made from "carbon-negative, regenerative wool" sourced from New Zealand.

The company's critics have accused it of greenwashing — that its claims about its positive environmental impact were more marketing than reality.

While Allbirds said in its latest SEC filing that it will be less focused on environmental conservation, it's unclear whether environmental principles will remain part of the company in some capacity.

For now, it looks like the transition might be good for shareholders, if not for business.

Allbirds' stock price was up 582% from the day prior at market close on Wednesday, reversing a yearslong slump.