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McDonald’s continues tech push with Apprente buyout, to automate drive-thru

After boosting its innovation program with two major tech deals earlier this year, McDonald’s (NYSE: MCD) this week agreed to acquire AI technology startup Apprente. The fast-food chain aims to tackle the growing competition in the sector more effectively by incorporating Apprente’s speech recognition technology into its drive-thru ordering system. Meanwhile, the management is yet to disclose the financial terms of the deal.

McDonald’s said it has already tested the technology pioneered by Silicon Valley-based Apprente, an expert in the development of artificial intelligence that can automate drive-thru ordering. The system, which will help reduce the time taken for delivering orders, will be used in the company’s mobile app and self-order kiosks in the future.

Also see: McDonald’s Q2 2019 Earnings Call Transcript

Apprente develops speech-recognition systems in multiple languages that automate voice-based orders. Once implemented, the technology is expected to reduce the number of employees at McDonald’s drive-thrus.

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“Building our technology infrastructure and digital capabilities are fundamental to our Velocity Growth Plan and enable us to meet rising expectations from our customers. Apprente’s gifted team, and the technology they have developed, will form McD Tech Labs, a new group integrated in our Global Technology team that will take our culture of innovation one step further,” said McDonald’s CEO Steve Easterbrook.

Earlier this year, McDonald’s acquired Dynamic Yield for around $300 million with the aim of incorporating the latter’s personalization and decision logic technology into its delivery system. Later, the company bought a stake in mobile software company Plexure.

As part of the aggressive innovation program, McDonald’s has been revamping its store chain across the country, adding facilities like self-order kiosks and digital menu display.

Related: McDonald’s Q4 profit jumps 103%, beats estimates

Meanwhile, the market’s immediate response to Tuesday’s announcement was not positive. McDonald’s stock traded down 4% in the early hours of the session. Last month, the stock had hit a record high after gaining steadily since the beginning of the year. In the past twelve months, the shares gained about 30%.

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