On January 28, Allbirds, a footwear brand known for its use of sustainable materials, announced plans to streamline its operations as part of a strategy to achieve profitable growth. The company revealed that it will close all of its full-price company-operated stores in the United States by the end of February 2026.
According to the company, the decision is aimed at reallocating resources toward channels that offer greater reach, flexibility, and operating leverage, including e-commerce, wholesale partnerships, and international distribution. The move clearly signals a shift away from a brick-and-mortar–heavy model toward a more capital-efficient business structure.
The store closures are expected to be a “capital-light” initiative. Details regarding anticipated reductions in selling, general, and administrative expenses (SG&A), as well as related cash charges, are scheduled to be discussed during the company’s fourth-quarter and full-year 2025 earnings call, expected to take place in March 2026.
A Strategic Shift in Retail and Cost Structure
This decision is positioned not as a short-term measure, but as part of a broader, multi-year reassessment of Allbirds’ retail strategy. Chief Executive Officer Joe Vernachio commented, “This is an important step for Allbirds, as we drive toward profitable growth under our turnaround strategy,” adding, “We have been opportunistically reducing our brick-and-mortar portfolio over the past two years. By exiting these remaining unprofitable doors, we are taking actions to reduce costs and support the long-term health of the business.”
Allbirds will not be exiting physical retail entirely. The company will continue to operate two outlet stores in the United States, as well as two full-price stores in London. By maintaining a limited number of flagship touchpoints, the brand aims to preserve its physical presence while continuing to lighten its overall operating structure.
Maintaining Its Position as a Sustainable Brand
Founded in 2015, Allbirds is a global lifestyle footwear brand built around the philosophy of “making better things in a better way.” The brand gained widespread recognition with its signature Wool Runner and is known for using natural materials such as Merino wool, tree-based fibers, and sugarcane in its products.
The latest business restructuring does not represent a retreat from the company’s sustainability commitments. Rather, it is framed as a pragmatic choice to ensure the long-term viability and growth of both the brand and the business. The move away from a fixed-cost–heavy retail model toward digital and partner-led distribution also aligns with broader structural shifts currently reshaping the global apparel and footwear industry.
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