Observed Signal · Sep 18, 2026 · Technical Release · Source: Retail Dive · Impact: 2/5 · Sentiment: Positive
Macy's Rolls Out AI Inventory Replenishment Tool
Macy's Inc. is expanding an artificial intelligence forecast overlay to its inventory replenishment operations, moving from pilot to broader implementation, according to its September 10 earnings call. The initiative aims to improve in-stock levels and drive inventory efficiencies by ensuring the right product is in the right place at the right time. COO and CFO Tom Edwards highlighted that supply chain efficiencies are expected in the second half of 2026, benefiting gross margin. This rollout is part of Macy's 'Bold New Chapter' transformation plan launched in 2024, expected to generate $235 million in savings by 2026. The company enters the fall season in a good inventory position, with inventory up 2.5% in Q2, aligned with sales growth. Other retailers like Target, Lowe's, and Kohl's are also optimizing inventory management with AI and other technologies.
Demonstrates AI adoption in retail operations, relevant to MarTech/AI infrastructure, but not directly advertising-focused.
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Key Takeaways & Evidence Grounding
- Macy's is rolling out an AI forecast overlay for inventory replenishment, moving from pilot to broader implementation.
- The AI capability aims to improve in-stock levels and inventory efficiencies.
- COO and CFO Tom Edwards announced the rollout during a September 10 earnings call.
- The initiative is part of Macy's 'Bold New Chapter' plan, targeting $235 million in supply chain savings by 2026.
- Macy's inventory was up 2.5% in Q2, in line with sales growth.
Connected Companies & Entities
4 Entities mapped“Macy's Inc. is adding an artificial intelligence forecast overlay capability to its replenishment operations, according to a Sept. 10 earnin...”
“Target is especially focused on making better inventory decisions, and has been exploring use cases for AI, machine learning and other techn...”
“Lowe's plans to use AI to improve in-stock levels and analyze demand trends through an expanded partnership with Relex Solutions.”
“Kohl's has also been adjusting its inventory management strategy.”
Ontology Mapping & Concepts
Related Market Signals & Shifts
Recent verified developments and strategic activity across this market segment.
Macy’s Leans on AI Despite Cautious 2026 Outlook
Macy’s, Inc. reported fourth-quarter and full-year 2025 results with net sales of $21.8 billion and 1.5% comparable‑sales growth. For fiscal 2026 it guided to $21.4 billion–$21.65 billion in annual sales, signaling a flat-to-modest decline versus 2025, and reiterated plans to close 65 additional Macy’s nameplate stores as part of a previously announced 150-store reduction. Company executives said they plan to expand use of artificial intelligence across supply chain, merchandising, marketing, call centers and customer-facing/omnichannel operations. Bloomingdale’s and Bluemercury posted stronger growth (Bloomingdale’s +7.4% comparable sales in 2025; Bluemercury +1.6% comparable annual sales). Macy’s will invest in events for 2026 (including the 100th Macy’s Thanksgiving Day Parade) and expand its “Reimagine” store updates to a 200-store fleet.
Macy’s launches Ask Macy’s AI shopping assistant
Macy’s has deployed an AI-powered shopping assistant called Ask Macy’s on its ecommerce site after roughly six months of development and a rapid beta. The project was re-based onto Google’s Gemini Enterprise for Customer Experience in collaboration with Google Cloud. During beta tests Ask Macy’s drove 4.75× higher revenue per visit among users (per Google Cloud). The assistant scans Macy’s full product catalogue, asks follow-up preference questions, and includes a virtual try-on that can superimpose items onto uploaded photos. The initial joint project began in early February 2026; a beta launched to test shoppers and employees four weeks later, with staged rollout to half site traffic before full release.
Retailers Invest in AI for Supply Chain and Shopping
Major retailers, including Gap, Dollar General, Ulta Beauty, and Kohl's, are accelerating AI adoption across supply chain, customer experience, and internal operations, as revealed in their Q2 earnings calls. Ulta's CEO Kecia Steelman highlighted early AI adoption for productivity and scaling opportunities, with new CTO Kelly Garcia advancing tech initiatives. Gap's capital expenditure for technology and supply chain is set at $650 million. Ulta uses AI for sourcing, inventory optimization, and AI-powered search and discovery, including its on-site shopping agent Ulta AI. Kohl's CEO Michael Bender reported early positive results from its AI shopping assistant, improving conversion and revenue per visit. Dollar General's CEO Todd Vasos mentioned building agentic operating systems for enterprise workflows, with net sales up 5.2% to $11.3 billion. Bain partner Aaron Cheris notes that most retailers are applying AI to specific areas rather than pursuing full AI transformation, with examples like Home Depot's Magic Apron and Walmart's Sparky.
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