Grocery AI Adoption Jumps to 68% as Tech Spending Doubles

Grocery retailers accelerate AI investment

Artificial intelligence adoption among grocery retailers surged to 68% in early 2025, up from 47% the previous year, according to new research from FMI — The Food Industry Association. The sharp increase coincides with a doubling of technology spending across the sector, with food retailers allocating an average of nearly 2% of total sales to technology investments in 2025, up from roughly 1% in 2024.

The trade group's annual industry report, released Tuesday, surveyed 70 food retailers and wholesalers in February, along with regulatory filings from eight publicly traded companies, collectively representing more than 42,000 stores.

Generative AI saw particularly rapid uptake, with 59% of food retailers now using the technology compared to 43% a year earlier. The percentage of retailers deploying organization-wide generative AI tools more than doubled year-over-year to reach 40%.

Technology optimism drives continued investment

Grocers plan to maintain their technology spending momentum, with 71% expecting to allocate more resources to tech in 2026 than they did in 2025. Nearly one in ten retailers indicated their technology expenses will increase "a lot" this year.

More than half of retailers surveyed expressed optimism about technology's impact on sales and profits, while 44% said technology "will change and enhance how we operate in-store." The share of respondents believing AI and emerging technologies will "change the way businesses are run" climbed to 46% in 2025, a nine-percentage-point increase.

Food traceability emerged as a particularly fast-growing technology application. While only 17% of retailers used technology solutions for traceability last year, 31% plan to implement these capabilities in 2026.

Why it matters

The doubling of technology spending as a percentage of sales signals a fundamental shift in how grocery retailers view digital infrastructure—not as a discretionary expense but as essential to competitiveness. With 70% of retailers expecting operating costs to rise and three-quarters concerned about economic pressures on consumer behavior, grocers are betting that AI and automation will help them navigate margin pressure while meeting evolving customer expectations. The rapid adoption of food traceability technology also reflects mounting regulatory and consumer demands for supply chain transparency.

Workforce implications remain uncertain

Despite heavy technology investment, only about 10% of retailers believe these systems will enable them to reassign staff. Instead, more than half anticipate increasing headcount for data analytics and digital technology specialists, suggesting AI is creating new roles rather than simply replacing existing ones.

Retailers are also beginning to focus on customer-facing applications, with 32% believing emerging technologies will change how consumers shop for groceries. Nearly one-fifth said conversational or agentic AI will alter grocery shopping behavior.

The findings were first reported by FMI — The Food Industry Association in its The Food Retailing Industry Speaks 2026 report.