Allbirds Exits U.S. Retail, Closing All Full-Price Stores

Allbirds, the San Francisco-based sustainable footwear company once celebrated as a direct-to-consumer (DTC) retail success, has announced it will close all of its remaining full-price retail locations in the United States by the end of February 2026. This dramatic retrenchment ends its domestic brick-and-mortar strategy as the brand shifts deeper into e-commerce, wholesale partnerships and international distribution models.

Retail Footprint Shrinks After Rapid Expansion

At its peak, Allbirds operated more than 60 stores globally, with roughly 45 in the U.S. alone. In recent years the company had been steadily reducing its physical footprint amid underperforming stores and cost pressures. Now, the remaining U.S. full-price stores will shutter, leaving just two outlet locations — one in California and one in Massachusetts — as its only domestic brick-and-mortar presence. Internationally, Allbirds will maintain two full-price stores in London.

CEO Joe Vernachio framed the decision as part of a broader turnaround strategy, stating that closing unprofitable retail doors is “an important step” toward driving profitable growth and supporting long-term business health. By reducing fixed costs tied to retail leases and staffing, the company aims to redirect resources into channels with broader reach and better operating leverage.

Pivoting Back to Digital Roots

Allbirds began as a digitally native brand, building a loyal following with minimalist designs and eco-friendly materials such as Merino wool and eucalyptus fiber. Physical stores were added to strengthen brand visibility and customer acquisition, but rising rents, labor costs and shifting consumer behavior have made many of these locations difficult to sustain profitably.

The move reflects a broader retail trend where brands increasingly prioritize online channels over brick-and-mortar operations. E-commerce offers geographic reach without the high overhead of physical stores, while wholesale partnerships can extend brand distribution through established retail partners without the fixed costs of company-run locations.

Retail industry observers have noted that Allbirds is not alone in reevaluating its physical footprint. Many retailers across categories are closing stores or downsizing to focus on digital and omnichannel capabilities amid changing consumer preferences and economic pressures.

Financial Pressures and Strategic Realignment

Allbirds’ retreat from U.S. retail comes amid ongoing financial challenges. In recent quarterly reporting periods, the company has faced declining revenue and continued losses — circumstances that have pressured the brand to tighten its operations and streamline its cost structure. Leadership has signaled that e-commerce and wholesale platforms can offer more scalable, capital-efficient growth pathways.

The company expects to discuss anticipated cost savings and potential one-time charges related to lease terminations during its upcoming earnings calls, signaling transparency with investors and a focus on restructuring for stability.

Implications for Brand and Customers

For loyal customers, the closures may mark the end of an era of experiential retail opportunities where shoppers could try on signature styles in person. However, Allbirds is counting on enhanced online experiences, comprehensive product information, detailed fit data, and streamlined logistics to retain customer engagement. The retention of outlet locations also offers value-focused consumers continued in-person access to products at discounted prices.

This latest development underscores the evolving nature of omnichannel retail, where brands continuously reassess the mix of physical and digital touchpoints to match consumer expectations while maintaining financial discipline. As Allbirds refocuses on efficient growth and sustainable operations, its retail evolution highlights the complex balancing act facing modern brands in a challenging market landscape.