Top News

Why Starbucks scrapped its AI inventory tool
22 May 2026

Starbucks has discontinued its worker-facing artificial intelligence (AI) program, designed to automate inventory counts. The decision comes nine months after the tool was introduced in North America.

The internal newsletter announcing this decision was reviewed by Reuters and confirmed by two employees with direct knowledge of the matter.

The move is part of CEO Brian Niccol's larger strategy to tackle persistent product shortages that have been hurting sales.

Tool often miscounted and mislabeled items
Tool troubles

The automated counting app was meant to give Starbucks better visibility into store shortages. However, it often miscounted and mislabeled items, sometimes confusing similar milk types or missing them altogether.

A video shared by Starbucks showed the tool failing to recognize a peppermint syrup bottle on the shelf while counting adjacent bottles.

Despite these issues, Starbucks had previously claimed that the adoption of this tool improved product availability in stores.

Shift in strategy for Starbucks
Strategy shift

In a statement to Reuters, Starbucks explained that the decision to terminate the program was taken to "standardize how inventory is counted across coffeehouses as we continue to focus on consistency and execution at scale."

The company also said it is working toward more frequent, daily replenishments to stores and continued supply chain improvements.

This indicates a shift in strategy as Starbucks looks for ways to improve its operations and customer experience.