Starbucks tried using AI to count syrup bottles – it kept hallucinating the inventory

Starbucks spent nine months testing an AI-powered inventory tool that was supposed to make restocking milk and syrups smarter and faster. Instead, the app was essentially "hallucinating" store shelves, missing bottles of peppermint syrup while counting others sitting right beside them.

The tool, called Automated Counting, was built by Seattle-based firm NomadGo and used tablets equipped with cameras and LiDAR sensors. CEO Brian Niccol rolled it out across North American locations last September, betting on automation to help reverse the company's financial struggles.

But the technology simply couldn't outperform human eyes. Starbucks has now quietly retired the program, saying it wants to "standardize how inventory is counted across coffeehouses."

Perhaps most telling: when the company shared news of the decision internally, employees welcomed it. Sometimes, it turns out, the most advanced solution in the room is still just a person counting bottles on a shelf.