Allbirds Agrees to $39 Million Sale

Allbirds, the Californian shoe company known for its sustainable materials and direct-to-consumer approach, has agreed to sell its assets to American Exchange Group (AXNY) for $39 million. This sale represents a dramatic decline in value from the company’s peak valuation of $4 billion in 2021.

From Silicon Valley Darling to Acquisition

Launched in 2021, Allbirds quickly gained popularity in Silicon Valley and among environmentally conscious consumers. The brand, famous for its wool sneakers made from sustainable materials like wool and eucalyptus, attracted early investment from celebrities like Leonardo DiCaprio in 2018.

Financial Struggles and Declining Sales

Despite initial success, Allbirds struggled to maintain momentum. Sales plummeted after the company went public. Revenue in the third quarter of 2025 reached $33 million, less than half of the $63 million generated during the same period in 2021. The company reported a net loss of over $101 million in 2022.

Deal Details and Shareholder Approval

The acquisition by AXNY, a brand management company, is still subject to shareholder approval. The deal is expected to be finalized in the second quarter of 2026. Net proceeds from the sale will be distributed to stockholders in the third quarter of 2026, according to Allbirds.

Company Response and Future Outlook

Joe Vernachio, Allbirds’ chief executive, stated: “This next chapter with AXNY builds on the foundational work already completed and sets up the brand to thrive in the years ahead.” The company canceled a scheduled earnings call on Tuesday, and its shares fell by over 10% on Wednesday.

A Shift in Strategy

Founded nearly two decades ago in New Zealand by former professional football player Tim Brown, Allbirds initially thrived as a direct-to-consumer brand. However, the company later shifted to selling through retailers, but this change did not reverse the decline in sales. The brand attempted to expand beyond its core shoe offerings, including flip-flops and leggings, but failed to retain consumer interest in these products.