Starbucks's Officially Discontinued AI Inventory Program was Riddled with Errors, Hated by Staff – CoffeeTalk

Starbucks has officially discontinued its ‘Automated Counting’ AI inventory program across all North American stores, just nine months after its launch in September 2025. Developed with Seattle-based company NomadGo, the program aimed to leverage 3D spatial intelligence, computer vision, augmented reality, and LiDAR sensors for real-time visibility of stock shortages. Despite CEO Brian Niccol’s hope that the technology would reduce administrative burdens for baristas and enhance customer service, reports indicate that the implementation fell short of its intended goals.

The initiative was part of Starbucks’ broader ‘Back to Starbucks’ transformation plan, which aims to drive revenue growth, improve comparable store sales, and open over 2,000 new locations globally, including around 400 in the U.S. However, practical testing revealed significant issues with the automated system. Many stores reported that the computer vision model struggled with basic tasks such as spatial awareness and object recognition, often leading to overcounted or overlooked inventory, as well as mislabeling of products. Notably, the AI app failed to distinguish between similar items like whole and oat milk cartons, and during a promotional video, it incorrectly showed an entire syrup bottle as missing.

Employee feedback indicated frustrations with the technology, as staff had to manipulate tablets in specific ways to make the AI recognize shelves, which ended up being more time-consuming than manual data entry. Starbucks has since removed blog posts previous praising the automated system, reflecting a significant shift in narrative regarding its efficacy.

In the wake of this failure, Starbucks has reverted to manual inventory checks while committing to a high-frequency replenishment model to minimize instances of out-of-stock items. While the Automated Counting system has seen its end, the company continues to focus on technology improvements, having reported a 9% increase in quarterly revenues to $9.5 billion and a 7.1% rise in comparable store sales across North America in Q2. Moreover, Starbucks maintains its plans to leverage AI in areas such as supply chain and scheduling tools, with a Smart Queue system introduced as part of its transformation strategy to improve customer service by efficiently managing incoming orders across various platforms.

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