Allbirds sales fall by 25%, firm lowers outlook

Allbirds co-founder and director Tim Brown pictured at the firm's Britomart, Auckland store. Photo / Dean Purcell

Allbirds, the maker of woollen shoes and activewear incorporating New Zealand Merino wool and other recycled materials, reported September-quarter revenue that fell 24.9% to US$43.0 million ($71.1m).

Its net loss narrowed to US$21.2m from US$31.6m in the third quarter of 2023 amid an ongoing restructure that has included store closures.

The firm lost a cumulative US$67.6m in the first nine months of this year, versus US$95.7m in the first three quarters of 2023.

Its September ebitda loss came in at US$16.2m from the year-ago US$19.0m.

It finished the quarter with US$78.6m in cash from the year-ago US$130m, and no borrowings from a US$50m credit facility.

Its Nasdaq-listed shares fell 1.94% in regular trading as the broader index rose 2.95%. The stock was down a further 5.3% in extended trading.

Former North Face executive Joe Vernachio was named Allbirds' chief executive in March as part of an ongoing restructure, but co-founders and former co-CEOs Tim Brown (left) and Joey Zwillinger remain directors. Brown is also chief innovation officer.

Full-year revenue guidance was lowered to US$187-193m from the previous US$190-210m.

And full-year ebitda guidance was downgraded to a US$71-75m loss from earlier forecast US$63m-75m.

Its ongoing shift away from direct sales saw distributors appointed in China and Europe.

In March, Allbirds said the Auckland and Gold Coast-based Compendium would become its distributor and “brand custodian” for Australasia, “including our spiritual home of New Zealand”.

Former All Whites captain Tim Brown and American biotech entrepreneur Joey Zwillinger co-founded the firm in 2014.

It listed on the Nasdaq in late 2021 in an IPO valuing the firm at US$2 billion.

But after poor financial results, fashion challenges and recession saw the stock tumble. It traded below US$1 for more than 30 days earlier this year, triggering a Nasdaq compliance warning.

The firm avoided being cut from the index by engineering a 1:20 reverse stock split in early September.

Its closing price today of US$11.14 leaves it with a market cap of US$90m.

Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.