On July 9, Starbucks rose 3.04% in regular trading, trading at $106.66/share, with turnover of $129 million. The rally was driven by reports that the company is leveraging artificial intelligence to develop proprietary software tools that could replace applications currently purchased from Microsoft and IBM.

According to an internal presentation, Starbucks is building AI-powered alternatives to a Microsoft inventory tracking system and an IBM maintenance management tool, with some replacements potentially rolling out by the end of next year. Starbucks Chief Technology Officer Anand Varadarajan disclosed in an internal forum that the company spends approximately $400 million annually on software and is actively seeking to reduce that expenditure. The initiative is part of Starbucks' broader turnaround strategy targeting $2 billion in cost reductions. The company has been encouraging its technology teams to extensively adopt AI, even incorporating AI usage metrics into employee bonus evaluations.

The news boosted market confidence in Starbucks' cost efficiency outlook while weighing on its software vendors, with IBM falling over 3% and Microsoft declining nearly 1% in pre-market trading.

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