By Jack Hough

Nike stock has hit a 12-year low, in part because of an identity crisis: Some investors say it has strayed too far from performance sneakers into fashion.

Meanwhile, the fashion sneaker company Allbirds announced this week it's leaving the feet business altogether for "AI compute infrastructure," and that stock popped 582% in a day. So maybe Nike is just having the wrong identity crisis?

If you haven't heard of Allbirds, picture the first time you learned that merino wool is surprisingly soft and breathable for socks. Then picture adding sugar cane soles, calling them eco-friendly sneakers, becoming a Silicon Valley status symbol, and going public in 2021 with a market value that briefly topped $4 billion. I'm grossly oversimplifying -- there's tree fiber involved, too.

Day one was the peak. There were never profits, and sales have collapsed, because 1) making popular sneakers is hard, 2) holding on to core tech-bro customers while expanding to normal people is harder, 3) making sneakers from natural materials costs a lot, and 4) big players can reproduce the Allbirds look and feel using mostly crude oil, which arguably is also a natural material, but you know what I mean.

By this past Tuesday, the stock had sank 99.6% from its debut. But after Wednesday's sixfold rise, it was only down 97.1%. As the old deep value investment adage goes, don't call it a comeback. (That was actually rapper LL Cool J in the 1990s hit, "Mama Said Knock You Out," and the context was totally different, but other than that, it's spot on.)

On one hand, this isn't 100% crazy. Coreweave once pivoted from crypto mining to buying Nvidia chips and renting out computing power. Since it came public last year, its stock price has tripled, putting the company's value at $74 billion, despite it burning huge sums of cash. Allbirds -- which will change its name to NewBird AI as part of its makeover -- was worth only around $113 million Thursday afternoon after giving back some of its gains. Surely a Wall Street report calling Allbirds stock cheap on a Coreweave-based scale can't be far behind.

On the other hand, this is at least 99.6% crazy. Allbirds has secured $50 million in funding to do something similar to Coreweave. But Coreweave is expected to have capital expenditures this year of 635 times that amount. Allbirds didn't respond to a request for comment.

What happens next depends on whether this thing achieves a critical mass of meme status. We're talking GameStop levels of Reddit buzz and rocket ship emojis. If that were to happen, and the stock were to trade high enough for long enough, then NewBirdAI could use a secondary stock offering to raise real cash, and be perceived as a more serious AI player, attracting even more investment. It's the financial equivalent of achieving sustained flight with a self-administered pants hike. Or maybe it can secure financing from a company whose stuff it is buying.

I wouldn't bet my money on the stock from here, but I might bet someone else's. I'm thinking of pivoting from writing about Wall Street absurdities to launching BirdBath, which will seek $50 million in funding for investing only in AI pivots.

Too bad LA Gear isn't still publicly traded. Those 1990s light-up sneakers were ahead of their time, and hyperscale cloud computing for model training and inference workloads would be the perfect follow-up.

Write to Jack Hough at jack.hough@barrons.com

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April 16, 2026 15:54 ET (19:54 GMT)

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