Allbirds is getting pressure to raise its share price.
Nasdaq has warned the sustainable shoe brand that its closing bid price for its Class A common stock had dropped below $1 dollar per share for 30 consecutive days, which does not comply with the stock exchange’s policies, Allbirds said in a release. The company has six months to raise its stock price to more than $1 dollar for 10 consecutive business days. If the struggling sneaker company does not achieve that, it can be eligible for a six month extension.
The company said it would “consider actions that it may take in response to this notification” to become compliant with Nasdaq listing requirements, but added that “no decisions about a response have been made at this time.”
Since its initial public offering in 2021, Allbirds’ stock has plunged more than 90 percent and currently trades at around 64 cents per share. After several quarters of falling sales, the company announced a business turnaround plan in March 2023 centered on revamping product, optimizing U.S. distribution and store profitability, re-evaluating its international strategy and improving cost savings. The brand, which was also challenged by an unsuccessful push into the activewear space, said it would refocus on core styles like the Wool Runner.
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Amid this change, Allbirds last month announced that its co-founder and chief executive officer Joey Zwillinger would step down, with chief operating officer Joe Vernachio taking over the CEO role. Zwillinger, who went from Allbirds’ co-CEO to sole CEO last May, has remained with the company as a member of the board of directors and special advisor.
In its fourth quarter reported in March, Allbirds’ revenues were down 14.5 percent to $72 million. Net loss in the fourth quarter was $56.8 million or $0.37 per basic and diluted share. For the full year of 2023, net revenues were down 14.7 percent to $254.1 million and net loss was $152.5 million, or $1.01 per basic and diluted share.
