McDonald’s to end AI testing at the drive-thru

The Street

TheStreet’s Conway Gittens brings you the biggest news of the day, including what investors are watching and why McDonald’s is ending its AI endeavor for now.

Transcript

00:00I'm Conway Gaines reporting from the New York Stock Exchange.

00:02Here's what we're watching on the street today.

00:05Investors were focused on the consumer

00:06in a pre-holiday thinned trading session.

00:09A jump in May retail sales was not as big as expected.

00:13Consumers are spending, but at a decelerating pace.

00:17Stubbornly high inflation and a Federal Reserve

00:19that's keeping interest rates at their highest point

00:21in nearly two decades are both eroding consumer spending

00:25power.

00:26Markets are closed Wednesday for the Juneteenth holiday.

00:30In other news, the rollout of any new technology

00:32can be marred by mishaps, and AI is no exception.

00:36McDonald's is pulling the plug on a trial run

00:39using AI to take orders at the drive-thru.

00:41The two-year test will stop in July,

00:43and the AI voice recognition technology powered by IBM

00:47will be yanked, according to a memo sent to franchisees

00:50seen by trade publication Restaurant Business.

00:53According to the report, the recognition technology

00:56wasn't very good at recognizing customer orders,

00:59resulting in some zany, viral-worthy mishaps

01:01at the drive-thru.

01:03The system is being tested in more than 100

01:04McDonald's restaurants in the U.S.

01:07Mason Smoot, the chief restaurant officer

01:09for McDonald's USA, told franchisees in that email memo,

01:13quote, while there have been successes to date,

01:16we feel there is an opportunity to explore

01:18voice ordering solutions more broadly,

01:20adding there will be, quote, an informed decision

01:23on future voice ordering solutions by the end of the year.

01:27McDonald's has moved slower than many of its peers

01:29when it comes to adopting AI at the drive-thru.

01:33That'll do it for your daily briefing

01:34from the New York Stock Exchange.

01:35I'm Conway Gittens with The Street.

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