July 18, 2024

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McDonald’s Ditches AI Drive-Thru Voice Technology. What Could This Mean for SoundHound AI Stock?

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McDonald’s (NYSE: MCD) recently announced that it was ditching its artificial intelligence (AI)-powered voice ordering technology powered by International Business Machines (NYSE: IBM). Instead, the fast food giant will look to replace the technology with an alternative solution by the end of the year.

Let’s look closer at McDonald’s decision and what impact it could have on SoundHound AI (NASDAQ: SOUN), whose voice-powered AI technology has been making a lot of inroads in the restaurant space lately.

A potential McDonald’s replacement

McDonald’s decision to end its partnership with IBM for automated order-taking technology after a two-year trial comes as a surprise, as the restaurant chain sold IBM the technology powering the solution back in the fall of 2021. McDonald’s originally purchased an AI voice start-up called Apprente in 2019 and integrated it into a venture called McD Tech Labs, which it later sold to IBM. Since that deal, it has been testing the technology, which it has deployed at more than 100 locations.

The voice-ordering technology will be shut off at all locations by July 26 of this year. When the technology was first rolled out, McDonald’s said it was about 85% accurate and that it could take 80% of orders. However, with social media, some of the tech’s larger screw-ups became viral, such as it adding ketchup packets and butter to a sundae and water order.

McDonald’s chief restaurant officer Mason Smoot told franchisees the company was happy with the trial but that there was “an opportunity to explore voice ordering solutions more broadly.”

Woman getting 2 drinks from car at a drive-thru.

Image source: Getty Images.

SoundHound is a potential logical choice as a replacement for IBM, as the company has gained a lot of traction in the restaurant space with its AI-powered drive-thru voice ordering technology and other industry-specific applications. These include its Smart Ordering platform, which takes orders and answers questions from inbound phone calls, as well as its Employee Assist solution,…

2024-06-19 18:30:00

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