Walmart reportedly ends contract with inventory robotics startup Bossa Nova

Robotics and automation startups have seen a strong uptick in interest over the course of the pandemic. And it’s easy to see which companies have a newfound interest in automating their workforce amid a seemingly endless virus-driven shutdown. But Walmart, which has long promised to take an increasing focus on such technology, has reportedly pulled the plug on one of its highest-profile partnerships.

The mega-retailer has ended a contract with Bossa Nova Robotics, according to new reporting from The Wall Street Journal. Walmart had announced in January that it would bring the Bay Area-based startup’s inventory-scanning robots to an additional 650 locations, bringing the total up to 1,000. The move has resulted in layoffs of around 50% at the Carnegie Mellon spin-off, per the WSJ report. It’s a huge hit at a time when such technologies should be thriving.

Bossa Nova co-founder Sarjoun Skaff didn’t confirm nor deny the WSJ report, instead issuing a no comment. He did, however, weigh in on the COVID-19 pandemic and its affect on the company, seeming to confirm that some layoffs had indeed occurred.

“I cannot comment on Walmart, however, the pandemic has forced us to streamline our operations and focus on our core technologies,” Skaff said. “We have made stunning advances in AI and robotics. Our retail AI is the industry’s best and works as well on robots as with fixed cameras, and our hardware, autonomy and operations excelled in more than 500 of the world’s most challenging stores. With the board’s full support, we continue deploying this technology with our partners in retail and in other fields.”

The tumult at Bossa Nova has stretched beyond layoffs. Skaff, who was CTO, took over the CEO spot in October when Stuart Pann left the position after less than nine months. Bossa Nova’s deal with Walmart was a major break for the startup, which began life in 2005 as a robotic toymaker before pivoting into something more serious. The startup’s relationship with Walmart dates back to 2017, when the chain ordered 50 robots.  Walmart’s massive order earlier was a major endorsement of Bossa Nova’s technology.

Such a change of heart would no doubt have a profound effect on the company.

Walmart apparently just wasn’t getting enough out of the deal. Bossa Nova’s robots had made their way into around 500 stores by the time the deal ended — around half of the initial proposed number. As COVID-19 has pushed more orders online, Walmart began exploring ways to use human workers to perform inventory while grabbing product for online fulfillment. Walmart’s operations, as well as those at other major retailers, will continue to evolve as brick-and-mortar locations reopen and customers shows signs of interest to return to the in-person shopping experience. The volatility of the pandemic still doesn’t lessen the sting or impact that Walmart’s abrupt reversal will have on Bossa Nova and its hopes for a rebound.

Meanwhile, Walmart’s robotic experiments aren’t over. The company’s Sam’s Club subsidiary recently announced it would bring Tennant’s floor scrubbing robots to all of its 599 stores. Interestingly, the company is also exploring ways for these machines to double up and perform in-store inventory checks; it’s not clear if these will be used only in Sam’s Club locations or extend to Walmart stores as well.