By Shashwat Chauhan
April 16 (Reuters) - A day after footwear maker Allbirds rose 582% on its plan to "pivot its business to AI compute infrastructure," social media firm Myseum was up 181% early on Thursday in the latest sign of an investor mania for artificial intelligence stocks.
Early on Wednesday, Allbirds said it would rebrand itself as "NewBird AI," having agreed to sell off most of its assets and intellectual property for $39 million last month. Allbirds said at the time that it planned to seek
shareholder approval for the "dissolution and wind-down of the company."
After the close on Wednesday, Myseum said it is "now operating under the new name Myseum.AI," in an effort that "illuminates the company's core technology platform that will integrate proprietary privacy-first artificial intelligence (AI) into its secure messaging and social media platforms."
The firms' advertised pivot to AI underscores how the sector's status as a magnet for investment capital can also provide small firms with struggling legacy businesses a chance to raise funds -- potentially at the expense of investors who buy in after the shares have already run up. On Thursday, Allbirds was down 29.5%.
"It does seem like this is peak AI when you've got companies like Allbirds pivoting to data centres and GPUs," said Kathleen Brooks, research director at XTB.
"It definitely encapsulates the amount of frenzy that there is in the AI market, but maybe they're just a bit late. Allbirds are not the early birds, that's for sure."
This pivot echoes past efforts by small U.S. firms that reshaped their business models to tap investor enthusiasm.
In 2017, beverage maker Long Island Iced Tea Corp pivoted to blockchain technology under the name Long Blockchain. U.S. securities regulators later brought an insider trading case that resulted in one defendant agreeing to pay $75,000 without admitting or denying the allegations.
Allbirds' Wednesday announcement sent its shares up as much as 872% on Wednesday. The company said it would execute a $50 million convertible financing agreement with an unnamed institutional investor and plans to use the proceeds to acquire graphics processing units (GPUs).
"A $50 million investment is a drop in the bucket in the broader neocloud market, where most companies run capex budgets well into the billions of dollars," William Blair analysts led by Dylan Carden said in a note. The analysts dropped their coverage on the stock.
"There is no valuation metric here with the wind-down of the footwear business and deep uncertainty about its new endeavors in cloud compute."
Allbirds lost $77.3 million for the year ended December 31, 2025, and lost $93.3 million a year earlier.
HOW THE MARKET TOOK IT
A record $3.87 billion worth of Allbirds shares changed hands on Wednesday, per LSEG data. Retail traders also jumped in and bought more than $5.2 million worth of its shares in the biggest one-day move on record, according data from Vanda Research.
It was among the most actively traded U.S. stocks by retail investors on Wednesday, ranking third by buy orders after Tesla and Nvidia, according to J.P.Morgan data.
The company's market capitalization swelled up to almost $148 million as of last close, surging from $21.7 million - which was down 99% from levels seen around its 2021 Nasdaq debut.
More than 16.3% of Allbirds' free floated shares are shorted and Wednesday's spike left short sellers with mark-to-market losses of approximately $13.6 million, according data analytics firm Ortex.
(Reporting by Shashwat Chauhan and Avinash P in Bengaluru; editing by Arpan Varghese and Colin Barr)
