Allbirds revenue has plummeted, but it says it has a plan

The rapid growth of allbirds has helped until then in Wall Street brush aside fears about deep losses – initially. Since then, allbirds shares have lost more than 95 % of their value. After its peak of $ 297.8 million in 2022, revenues decreased by more than a third until 2024, despite a wider healthy market for comfortable shoes. The company stated on Thursday that sales decreased by 23 % in its second financial quarter, indicating the difficulty of the presence of allbirds to return.

Now, Allbirds Tim Brown and its CEO, Joe Vernachio, says that the company has a strategy to restore valid customers: zero in what was the best that it did in the first place. This means making multi -use lifestyle shoes with a unique appearance, using innovative and sustainable materials to maintain a central environmental credit for their identity. The company closed stores and abandoned some of its fateful attempts to expand in other categories to stimulate growth: a funeral made of Mirino’s wool, for example, or running shoes directed towards performance.

Fast growth, some errors

It was a classic story of a hot brand that grows very quickly and made hasty mistakes in its ascension. In the case of allbirds, this construction included very widely of products and opening many stores. By late 2023, allbirds had 45 American stores; Now he returned to 21 sites.

The brand was also very optimistic about its ability to sell directly to consumers. It took a very long time to line up in wholesale partnerships with national store chains such as Nordstrom, which is properly betting that its stores and website were sufficient to attract new customers and serve its smart fans.

Meanwhile, imitators of the natural fiber shoes of allbirds, and the disguised brand story that was initially at first was in danger. “The time we had to develop and develop this story was compressed in an intense way,” says Brown. luck In an exclusive interview before an allbirds anniversary for 10 years. “With the quick success that came on our way, we lost some DNA.”

Like many brands in growth mode, allbirds try to throw a broader network for customers. Examples include The Tree Flyer, a model launched in 2022 and aims at younger customers, instead of the sweet brand spot for people in the thirties and forty -up. He did not hold the shoe and was stopped. Other products are floundered by: Sufi internal dress, expansion of elements far from their experience, such as slow jackets.

Allbirds was not just opening many stores due to the size of their sales; These stores were also very large for their need, and did not allow an attractive show of their shoes.

It can be less when it comes to a store

All of these messages were strained on the financial affairs of the company: In the five financial years that ended in December 2024, allbirds lost $ 419 million over sales of $ 1.24 billion. Recently, credit facilities are announced to give itself more than the financial breathing room.

I closed many of its stores, and the 21 shops that are still the brand are still smaller – half the size of the stores that were opened in that raid a few years ago. “We now have books, plants and opinions to relax, and we make people spend a lot of time in the store, giving us a better opportunity to interact with them,” says Vernachio.

From the court of courtesy allbirds

The company also listens to the concerns that some analysts have expressed that the brand messages have focused a lot on the environmental virtues, highlighting the carbon emissions imprint for each element and the company’s efforts to reduce it. Some urged allbirds to focus more on the appearance and comfort of the shoes. Vernachio says some of this criticism: The focus on sustainable materials makes Allbirds more innovative in its appearance and designs.

But he notes that allbirds now use the word “nature” to market it much more than “sustainability”.

“We believe that the word” sustainability “looks like energy, like sorting your garbage,” he said jokingly.

Take a trip again?

Brown and Virnachio, who took the reins last year, insisted to replace the Braun Joy Zewger founder, that the brand’s attractiveness was not just a heresy. They focus on taking advantage of what made Allbirds a sensation in the first place: wonderful and comfortable innovative shoes.

Brown, New Zealand, loves to quote the Maori proverb: “Ka Mai, Ka Mori“Or walk back in the future.” This moment revolves around returning to the beginning and returning to those basic principles that lost where we had a lot of growth and expansion. “

As he did in 2015, Brown sees a white space on the market for shoes that provide simplicity. He said that the sneakers are often “designed” and tend to rely on plastic.

But the truth remains that many of the largest songs of recent years in shoes are swollen and cheerful in design, and heavy on artificial materials. Brands such as Hoka and ON Running have witnessed great success, and artistic brands such as New Balance and Brooks Running have succeeded in lifestyle shoes, where they occupied some of the space occupied by allbirds.

The Allbirds has re -launch its original sales, The Wool Runner NZ (a reference to the Brown roots in New Zealand), with some adjustments and features to design such as a dual -density sole that uses the cooking memory foam.

There is also a skin -based skin shoe in the early next year called Terralux, with the appearance of Vernachio called “more high”.

“What we tend is that people want to have a comfort at the level of sport shoes on every occasion.”

Another promising product is a tree trading. It is made of tree fibers – a reference to the first adopters who chose allbirds for its green virtues. (A copy of the recycled polyester and the recycled Italian wool will be launched next month.) The script line has been marketed as “inspired by the court”, which means that it was dedicated to people who play tennis and other court games. But she found her place as a multi -use daily shoe with clean lines and features such as a prominent rubber sole that can be worn in a number of different situations. “We have long been late in getting such shoes in the client’s wardrobe,” says Vernachio.

Ten years after its founding, the sports shoe market and the world appear completely different. But returning to the original values and aesthetics of allbirds is the way forward. Brown said: “This is a brand worth fighting, with principles that you have never felt full of potential and important at this moment.”