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How Sam's Club plans to take on its rival Costco

Amid the recent flurry of excitement around the transformational potential of ChatGPT is the fact that companies have been using artificial intelligence across their businesses for years.

But few companies have the ability to gather the massive data sets that power AI quite like Walmart. There are roughly 4,700 Walmart stores and 600 Sam’s Clubs in the U.S. employing a combined 1.6 million workers — or associates as the company likes to call them.

Deploying artificial intelligence and machine learning in ways that improve both the customer and employee experience across such a massive environment is the focus of Walmart’s AI strategy, said Anshu Bhardwaj, senior vice president of tech strategy and commercialization at the retail giant.

At warehouse chain Sam’s Club, the membership model provides the company with huge amounts of data about what members are searching for, what they like, what they’re buying and when. “[Customers] are generating all these breadcrumbs about what they like and want and that’s allowing us to make the shopping experience better,” she said.

One way to do that is to make sure the items they want to buy are in stock. At Sam’s, that means staying on top of roughly 6,000 items stacked on shelves in warehouse stores that average 136,000 sq. feet.

Sam’s is using, of all things, floor scrubbers to do just that. As they travel around the stores, keeping floors clean and free of debris, they’re also capturing, in real time, images of every item in the store. These scrubbers (there’s one in each store) are equipped with inventory intelligence towers that take more than 20 million photos of everything on the shelves every day.

A Brain Corp. autonomous floor scrubber, called an Auto-C, cleans the aisle of a Walmart’s store. Sam’s Club completed the rollout of roughly 600 specialized scrubbers with inventory scan towers last October in a partnership Brain Corp.

Source: Walmart

“What this means is that I can distinguish Kellogg’s Froot Loops from Kellogg’s Frosted Flakes and the depth in which they’re stocked on the shelves,” explained Bhardwaj. “And if you think about a shelf, it doesn’t always have items in the front. They could be staked in the back and then there are shadows as well.”

This is where AI and machine learning comes in. She said the company has trained its algorithms to discern the different brands and their inventory positions, taking into account how much light there is or how deep the shelf is, with more than 95% accuracy. When a product gets to a pre-determined level, the stock room is automatically alerted so that the item is always available.

If there’s nothing in the stock room, but a delivery scheduled that day contains Kellogg’s products, the algorithm will tell an associate to take that Kellogg palette directly to the sales floor, rather than to the stock room. Bhardwaj said since deploying this AI last year, employee productivity has increased 15%.

“This is how we close the loop,” she said. “We never want to be out of stock on any item.”

AI is also powering the Walmart shopping app. For example, if a customer orders Pampers on the app, it can now recognize when this customer last ordered the product and whether the size is still appropriate.

Even though Walmart has been on its AI journey for years, the goal has remained the same, Bhardwaj said: Find better ways to figure out what the customer wants to buy and how best to get it to them.  “AI is a way to make those decisions super easy for us,” she said. “That’s how I look at it.”

The goal is to create as little friction between what customers want and what they ultimately buy. “I hate shopping for things like milk and toilet paper,” Bhardwaj said. “We want to make the shopping experience for everyday items a no-brainer for our customers.”

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Apple’s market share slides in China as iPhone shipments decline, analyst Kuo says

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Apple's market share slides in China as iPhone shipments decline, analyst Kuo says

Jaap Arriens | Nurphoto | Getty Images

Apple is losing market share in China due to declining iPhone shipments, supply chain analyst Ming-Chi Kuo wrote in a report on Friday. The stock slid 2.4%.

“Apple has adopted a cautious stance when discussing 2025 iPhone production plans with key suppliers,” Kuo, an analyst at TF Securities, wrote in the post. He added that despite the expected launch of the new iPhone SE 4, shipments are expected to decline 6% year over year for the first half of 2025.

Kuo expects Apple’s market share to continue to slide, as two of the coming iPhones are so thin that they likely will only support eSIM, which the Chinese market currently does not promote.

“These two models could face shipping momentum challenges unless their design is modified,” he wrote.

Kuo wrote that in December, overall smartphone shipments in China were flat from a year earlier, but iPhone shipments dropped 10% to 12%.

There is also “no evidence” that Apple Intelligence, the company’s on-device artificial intelligence offering, is driving hardware upgrades or services revenue, according to Kuo. He wrote that the feature “has not boosted iPhone replacement demand,” according to a supply chain survey he conducted, and added that in his view, the feature’s appeal “has significantly declined compared to cloud-based AI services, which have advanced rapidly in subsequent months.”

Apple’s estimated iPhone shipments total about 220 million units for 2024 and between about 220 million and 225 million for this year, Kuo wrote. That is “below the market consensus of 240 million or more,” he wrote.

Apple did not immediately respond to CNBC’s request for comment.

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Amazon to halt some of its DEI programs: Internal memo

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Amazon to halt some of its DEI programs: Internal memo

Amazon said it is halting some of its diversity and inclusion initiatives, joining a growing list of major corporations that have made similar moves in the face of increasing public and legal scrutiny.

In a Dec. 16 internal note to staffers that was obtained by CNBC, Candi Castleberry, Amazon’s VP of inclusive experiences and technology, said the company was in the process of “winding down outdated programs and materials” as part of a broader review of hundreds of initiatives.

“Rather than have individual groups build programs, we are focusing on programs with proven outcomes — and we also aim to foster a more truly inclusive culture,” Castleberry wrote in the note, which was first reported by Bloomberg.

Castleberry’s memo doesn’t say which programs the company is dropping as a result of its review. The company typically releases annual data on the racial and gender makeup of its workforce, and it also operates Black, LGBTQ+, indigenous and veteran employee resource groups, among others.

In 2020, Amazon set a goal of doubling the number of Black employees in vice president and director roles. It announced the same goal in 2021 and also pledged to hire 30% more Black employees for product manager, engineer and other corporate roles.

Meta on Friday made a similar retreat from its diversity, equity and inclusion initiatives. The social media company said it’s ending its approach of considering qualified candidates from underrepresented groups for open roles and its equity and inclusion training programs. The decision drew backlash from Meta employees, including one staffer who wrote, “If you don’t stand by your principles when things get difficult, they aren’t values. They’re hobbies.”

Other companies, including McDonald’s, Walmart and Ford, have also made changes to their DEI initiatives in recent months. Rising conservative backlash and the Supreme Court’s ruling against affirmative action in 2023 spurred many corporations to alter or discontinue their DEI programs.

Amazon, which is the nation’s second-largest private employer behind Walmart, also recently made changes to its “Our Positions” webpage, which lays out the company’s stance on a variety of policy issues. Previously, there were separate sections dedicated to “Equity for Black people,” “Diversity, equity and inclusion” and “LGBTQ+ rights,” according to records from the Internet Archive’s Wayback Machine.

The current webpage has streamlined those sections into a single paragraph. The section says that Amazon believes in creating a diverse and inclusive company and that inequitable treatment of anyone is unacceptable. The Information earlier reported the changes.

Amazon spokesperson Kelly Nantel told CNBC in a statement: “We update this page from time to time to ensure that it reflects updates we’ve made to various programs and positions.”

Read the full memo from Amazon’s Castleberry:

Team,

As we head toward the end of the year, I want to give another update on the work we’ve been doing around representation and inclusion.

As a large, global company that operates in different countries and industries, we serve hundreds of millions of customers from a range of backgrounds and globally diverse communities. To serve them effectively, we need millions of employees and partners that reflect our customers and communities. We strive to be representative of those customers and build a culture that’s inclusive for everyone.

In the last few years we took a new approach, reviewing hundreds of programs across the company, using science to evaluate their effectiveness, impact, and ROI — identifying the ones we believed should continue. Each one of these addresses a specific disparity, and is designed to end when that disparity is eliminated. In parallel, we worked to unify employee groups together under one umbrella, and build programs that are open to all. Rather than have individual groups build programs, we are focusing on programs with proven outcomes — and we also aim to foster a more truly inclusive culture. You can read more about this on our Together at Amazon page on A to Z.

This approach — where we move away from programs that were separate from our existing processes, and instead integrating our work into existing processes so they become durable — is the evolution to “built in” and “born inclusive,” instead of “bolted on.” As part of this evolution, we’ve been winding down outdated programs and materials, and we’re aiming to complete that by the end of 2024. We also know there will always be individuals or teams who continue to do well-intentioned things that don’t align with our company-wide approach, and we might not always see those right away. But we’ll keep at it.

We’ll continue to share ongoing updates, and appreciate your hard work in driving this progress. We believe this is important work, so we’ll keep investing in programs that help us reflect those audiences, help employees grow, thrive, and connect, and we remain dedicated to delivering inclusive experiences for customers, employees, and communities around the world.

#InThisTogether,

Candi

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Tesla recalling 239,000 vehicles in U.S. over rearview camera failures

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Tesla recalling 239,000 vehicles in U.S. over rearview camera failures

New Tesla Model 3 vehicles on a truck at a logistics drop zone in Seattle, Washington, on Aug. 22, 2024.

M. Scott Brauer | Bloomberg | Getty Images

Tesla is voluntarily recalling about 239,000 of its electric vehicles in the U.S. to fix an issue that can cause its rearview cameras to fail, the company disclosed in filings posted Friday to the National Highway Traffic Safety Administration’s website.

“A rearview camera that does not display an image reduces the driver’s rear view, increasing the risk of a crash,” Tesla wrote in a letter to the regulator. The recall applies to Tesla’s 2024-2025 Model 3 and Model S sedans, and to its 2023-2025 Model X and Model Y SUVs.

The company also said in the acknowledgement letter that it has already “released an over-the-air (OTA) software update, free of charge” that can fix some of the vehicles’ camera issues.

In 2024, Tesla issued 16 recalls in the U.S. that applied to 5.14 million of its EVs, according to NHTSA data. The recall remedies included a mix of over-the-air software updates and parts replacements. More than 40% of last year’s recalls pertained to issues with the newest vehicle in the company’s lineup, the Cybertruck, an angular steel pickup that Tesla began delivering to customers in late 2023.

Regarding the latest recall, the company said it had received 887 warranty claims and dozens of field reports but told the NHTSA that it was not aware of any injurious, fatal or other collisions resulting from the rearview camera failures.

Other customers with vehicles that “experienced a circuit board failure or stress that may lead to a circuit board failure,” which cause the backup camera failures, can have their vehicles’ computers replaced by Tesla, free of charge, the company said.

Tesla did not immediately respond to CNBC’s request for comment.

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