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Starbucks $SBUX -1.33% is retiring an AI-powered inventory counting tool across its North American stores, nine months after deploying it as part of CEO Brian Niccol's turnaround campaign, according to Reuters.
Reuters obtained a company-wide memo sent Monday and had its contents confirmed by two employees, which formally announced the program's end. The memo stated: "Starting today, Automated Counting will be retired. Beverage components and milk will now be counted the same way you count other inventory categories in your coffeehouse."
NomadGo, a Seattle-based company, developed the system, which relied on LiDAR sensors and tablet cameras to generate automated tallies of syrups, milks, and similar beverage products stored on store shelves. Though the technology predated Niccol's arrival, he chose to push it into stores across North America shortly after assuming the CEO role in September 2024. Where workers had previously tallied stock by hand, the app was meant to handle those counts automatically, with the promise of greater speed and fewer errors.
The program struggled with basic product identification. Errors were common, Reuters found, with the system routinely confusing visually similar products like different milk varieties or overlooking stocked items altogether. A Starbucks promotional video from the launch period captured the malfunction plainly: a peppermint syrup bottle sitting on the shelf went unregistered as the system scanned the surrounding bottles on either side of it.
