Allbirds execs noted on the company's earning call that the COVID lockdowns in China and the Russia-Ukraine war led to a drop in international business for the sneaker company.

Video Transcript

BRAD SMITH: And another company that we're watching here today, Allbirds, another mover. And the shares for this company, you talk about moving lower, yeah Allbirds is, I don't know, seeing its wings clipped a little bit here. Down by about--

BRIAN SOZZI: You're hanging out with us too much.

[LAUGHING]

BRAD SMITH: A drop in international business to COVID 19 lock-downs in China, as well as the war in Russia and Ukraine. Particularly, here, retail channel sales, that grew 129 percent in the first quarter compared to last year. Opening more stores, of course they're investing heavily in where those brick and mortar locations are. I think one of the benefits that they do have as well is looking into a lot of the direct to consumer data to really identify where you may see more cyclically in those purchases.

But again, for Allbirds and how investors are receiving this, sending shares lower on the day, I think it does come back to the competitive landscape. You've got to Lululemon that's getting into the sneaker category. In another competitive option that's out there on the performance side, Allbirds has always kind of leaned into what that office wear may look like. And so I think going forward in this current quarter, particularly, how many of those sales actually take place to people who are going back into those office environments or just looking to change up their wardrobe as they're reentering society in some fashion or another, that's particularly where they might look at an Allbirds option.

[INTERPOSING VOICES]

BRIAN SOZZI: I've got Allbirds rolling out. You guys can't see it. I mean these things are awesome. But look, I'm surprised to see this market cap of Allbirds. We've talked this company numerous times.

They check a lot of boxes on ESG and a lot of boxes that Nike, Under Armor, and Adidas certainly do not check in ESG. So they have that good messaging. Market cap only $550 million and right now you're seeing Allbirds stock at about $3.76, almost trading in book value. When you get to these levels you have to wonder if somebody comes in here and tries to make a play for Allbirds. Good messaging, good product, and they're actually trying to grow their business in many areas across the country. So it's tough to see this.

BRAD SMITH: Lululemon could have done that if they really wanted to.

BRIAN SOZZI: Wow, now that's camera work.

JULIE HYMAN: Oh, look at that.

[INTERPOSING VOICES]

BRIAN SOZZI: I'm a foot model in my prior life. There we go. Oh, there we go.

JULIE HYMAN: The international sales were really the weak spot here. So I think that's going to continue to be a problem for them potentially this year.