One of the last questions that Richard Galanti, the outgoing chief financial officer at Costco, answered during the retailer’s March earnings call was about how Costco is using artificial intelligence (AI) and how the technology would impact its business.
In response, Galanti, who was replaced as CFO by Gary Millerchip in March, said Costco was still “in the early innings” of AI use. But he also offered some quick perspective on the company’s path to adopting AI.
“We’ve had third-party AI companies, large companies, including ones that are headquartered in Seattle, come out and talk to us,” Galanti stated. He elaborated that there was “a whole list of things that we’re doing with working with IT and our CEO and our heads of operations and merchandising to see where and how it might fit.”
At the very least, that list includes AI use cases for Costco that reach into inventory and demand forecasting. In 2025, Costco has also shared names of technology vendors that it is working with to leverage AI for its travel benefits system, as well as its retail media network.
How Costco is using AI in its warehouses
As far back as 2018, Costco used a machine learning model designed to predict how many bakery products it would need to stock each day. The pilot took place across 30 Costco stores, which the retailer refers to as warehouses. The exercise in demand forecasting relied on historical trends to train Costco’s model. In addition, the model factored in information such as weather and schedules of local sporting events.
Ultimately, the approach saved Costco almost $100 million, according to a 2024 article published by SAP. It also led to wider adoption throughout the company.
Costco Travel’s use of Travelport
One of the services that Costco provides to its members is the option to book trips through Costco Travel. In February, Costco announced that it would work with the technology company Travelport. The deal involves what Travelport refers to as its “AI-powered Content Curation Layer” to curate travel experiences.
The end result is a portal that pulls travel content from multiple sources and provides a search experience for Costco members. Costco went into the agreement hoping to create a more valuable system for its members.
“Costco Travel is focused on delivering more value to its members by giving them more choice and better offers when planning their trips, and Travelport provides the seamless, modern travel retailing experience that their customers have come to expect,” said Jason Toothman, the chief commercial officer for agency business at Travelport, when the deal was unveiled.
AI additions to Costco’s retail media network
Most recently, Costco brought on the technology provider GrowthLoop, which announced in August that it would provide its “agentic AI platform” to Costco’s retail media team. GrowthLoop’s solution is built to apply AI to audience segmentation. Now, it will assist Costco with growing its retail media network’s addressable audience and targeting advertisements to those customers in more effective ways.
Specifically, GrowthLoop asserts that its solution could help Costco to achieve “increased relevance and impact for advertisers looking to reach specific audiences with tailored messaging across Costco’s customer base.”
Costco is No. 7 in the Top 2000 Database. The database is Digital Commerce 360’s ranking of the largest online retailers in North America by their annual ecommerce sales. It’s also the fourth-largest Mass Merchant in the database. Digital Commerce 360 projects that Costco’s total online sales in 2025 will reach $18.87 billion.
Costco web sales by year
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