Tech
US fast-food chains add turn to automation to boost speed
From robotic grills to faster blenders with custom ice and milk dispensers, major U.S. restaurant chains including Starbucks, Domino’s (DPZ.N), and Chipotle (CMG.N) are touting new technologies to automate production, cut labor costs and potentially boost profit margins.
Starbucks said it plans to roll out a coffee-making machine, the Siren System, in around 10% of its stores starting next year. Starbucks claims that baristas using the machine will be able to produce drinks with less time and fewer steps, making a grande mocha frappucinno in 36 seconds rather than 87 seconds.
With mass shortages of low-cost labor due to the pandemic, chains shifted to technology investments in their kitchens to fill the gap. The addition of automation tools in restaurant chains could cut down on wait times, driving higher consumer engagement and increasing sales for the rest of the year, restaurant executives say.
Starbucks Chief Financial Officer Rachel Ruggeri said Tuesday that the coffee chain envisions “a more stabilized production environment, which will help drive margin expansion well into the future.”
Around 58% of restaurant operators said the use of automation and tech to help address labor shortages will become more common this year, according to a report by the National Restaurant Association in February.
Thirty-six percent of 1,000 U.S. people told HungerRush in a survey in May that they believed major restaurant chains don’t have enough staff to take orders, prepare food, and handle deliveries.
“Now most consumers expect their local pizza place and their favorite coffee house to remember their last order, know what credit card they want to use, and make it quick and easy for them to complete an order,” said Aaron Nilsson, chief information officer of Jet Pizza, a Michigan-based chain that recently launched an AI-powered phone bot for taking pizza orders. “Society has moved on and automation is expected – even from the small-time operator.”
Chipotle introduced a robotic prototype in July that cuts and peels avocados to reduce prep time by 50% and help employees prepare orders faster. The Colorado-based chain also rolled out a dual-sided grill, which cooks 70% faster than the average employee, to 10 high-volume locations, Chipotle CEO Brian Niccol said during an earnings call last week.
Domino’s has launched several automation projects over the past years. In 2021, Domino’s released a pizza delivery robot car in selective stores at its Houston locations. Last year, Domino’s Pizza Enterprises announced an automated pizza prep device in partnership with Picnic Works, a Seattle-based food automation startup.
Domino’s also added an automated supply chain center in Indiana with machines that make batches of dough. The center, which opened in March, will service Domino’s shops throughout Indiana, Illinois, Michigan and Wisconsin.
“Anytime there’s new automation, it creates new kinds of jobs,” said Gaurav Kachhawa, chief product officer at Gupshup, a conversational messaging platform. “It’s not going to be net shrinking. I think it’s going to be expanding the overall economy and its efficiency.”
OpenAI and Japanese conglomerate SoftBank (9984.T) will each commit $19 billion to fund Stargate, a joint venture to develop data centers for artificial intelligence in the U.S., the Information reported on Wednesday.
The ChatGPT maker will hold a 40% interest in Stargate, and would act as an extension of OpenAI, the report said, citing OpenAI CEO Sam Altman speaking to colleagues. His comments imply SoftBank would also have a 40% interest, the report added.
OpenAI and SoftBank did not immediately respond to Reuters’ requests for comment.
On Tuesday, U.S. President Donald Trump announced that OpenAI, SoftBank Group and Oracle (ORCL.N) will unveil Stargate and invest $500 billion over the next four years to help the United States stay ahead of China and other rivals in the global AI race.
Stargate will initially deploy $100 billion and the rest of the funding is expected over the next four years. The project is being led by SoftBank and OpenAI.
Taiwan’s HTC (2498.TW) said on Thursday it will sell part of its unit for extended reality (XR) headsets and glasses to Google (GOOGL.O) for $250 million and transfer some of its employees to the U.S. company.
The transaction is expected to close in the first quarter of this year, HTC said.
The two companies will also explore further collaboration opportunities, HTC added.
Google said in a separate statement that the deal will accelerate the development of the Android XR platform and strengthen the ecosystem for headsets and glasses.
Lu Chia-te, HTC vice president and general counsel, told reporters the company had granted its intellectual property rights to Google as a non-exclusive license.
“Therefore, this is not a buyout nor an exclusive licence. In the future, HTC will still retain the ability to use, utilise, and even further develop it without any restrictions,” he said.
Microsoft’s (MSFT.O) LinkedIn has been sued by Premium customers who said the business-focused social media platform disclosed their private messages to third parties without permission to train generative artificial intelligence models.
According to a proposed class action filed on Tuesday night on behalf of millions of LinkedIn Premium customers, LinkedIn quietly introduced a privacy setting last August that let users enable or disable the sharing of their personal data.
Customers said LinkedIn then discreetly updated its privacy policy on Sept. 18 to say data could be used to train AI models, and in a “frequently asked questions” hyperlink said opting out “does not affect training that has already taken place.”
This attempt to “cover its tracks” suggests LinkedIn was fully aware it violated customers’ privacy and its promise to use personal data only to support and improve its platform, in order to minimize public scrutiny and legal fallout, the complaint said.
The lawsuit was filed in the San Jose, California, federal court on behalf of LinkedIn Premium customers who sent or received InMail messages, and whose private information was disclosed to third parties for AI training before Sept. 18.
It seeks unspecified damages for breach of contract and violations of California’s unfair competition law, and $1,000 per person for violations of the federal Stored Communications Act.
A lawyer for Prince Harry on Wednesday said the Duke of Sussex had reached a settlement with Rupert Murdoch’s news conglomerate.
LinkedIn said in a statement: “These are false claims with no merit.”
A lawyer for the plaintiffs had no immediate additional comment.
The lawsuit was filed several hours after U.S. President Donald Trump announced a joint venture among Microsoft-backed OpenAI, Oracle (ORCL.N) and SoftBank (9984.T), with a potential $500 billion of investment, to build AI infrastructure in the United States.
OpenAI, SoftBank each commit 19bn dollars to Stargate AI data center
Taiwan’s HTC to sell part of XR unit to Google for 250mn dollars
Microsoft’s LinkedIn sued for disclosing customer information to train AI models
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