Costco lets AI reorder pharmacy drugs on its own; in-stock above 98%

Costco's pharmacy inventory system compares prescription drug prices across suppliers and "autonomously and predictively reorders inventory", president and CEO Ron Vachris said on the company's earnings call of 11 December 2025, as [PYMNTS](https://www.pymnts.com/news/retail/2026/costco-trusts-ai-to-reorder-drugs-most-retailers-wont/) reported on 13 November 2026. He said the change lifted pharmacy in-stock levels to more than 98%. He gave no figure for where they stood before.

The job

The system does two things a pharmacy buyer does, by PYMNTS's account: it checks what each supplier charges for a drug, then places the replenishment order before the shelf runs low. PYMNTS describes it as placing orders "on its own". Neither Vachris's remarks nor the report say whether there is a spending limit per order, a list of approved suppliers, or a person who reviews what it bought.

What Costco says changed

• In-stock levels above 98%, with no earlier figure to compare.
• Vachris said the system played an important role in mid-teen percentage growth in prescriptions filled, improved margins and lowered prices for members. He put no number on margins or prices.
• Chief financial officer Gary Millerchip said on the March 2026 call that Costco had added more AI tools for pharmacy in-stock positions.
• Fuel is next: Vachris said in December that Costco was deploying AI tools in its gas business and expected better inventory management and extra sales. Costco ran 774 gas stations at the end of fiscal 2026, and gasoline was 11% of net sales, according to its [annual report](https://www.sec.gov/Archives/edgar/data/909832/000090983226000093/cost-20260830.htm).

The catch

Every result is an executive's statement on an earnings call, with no method. "Costco has not detailed AI's impact on growth in its pharmacy department," PYMNTS writes. When Vachris explained fiscal 2026's pharmacy growth on 24 September (sales up nearly 20%), he credited programmes for GLP-1 drugs (the diabetes and weight-loss class) and fertility drugs, pickup lockers and mobile prepayment, by PYMNTS's account of that call.

The annual report, for the year to 30 August 2026, does not mention the system. It says sales in the group that includes pharmacy and gasoline rose 20%, while that group's gross margin as a share of its own sales fell 14 basis points (0.14 percentage points), "primarily due to gasoline and pharmacy". Vachris said in September that lower prices under Medicare's maximum fair price rules were more than offset by growth. The filing cannot confirm or contradict his December statement that the system improved margins.

Not disclosed: what the system cost, who built it, how many orders it places, how often it orders wrongly, and what happened to the people who compared prices and placed orders before.

How unusual this is

A PYMNTS Intelligence report from July surveyed 60 senior technology executives at US companies with at least $1 billion in annual revenue. Among the retailers, 90% would limit an AI agent to looking things up, 5% would let it act with a person's approval, and none of the 60 expects fully autonomous AI within five years. PYMNTS does not say how many of the 60 were retailers.

What to do if you run procurement or inventory planning

• Pick one category where a stock-out loses the sale and several suppliers sell the same item. Record today's in-stock rate and price paid per unit, so a trial has the baseline Costco's figure lacks.
• Before any system orders unattended, write down the maximum order value, the approved suppliers, and who reviews the order log and how often. Ask the vendor to show you that log at a customer.
• Ask finance to report gross margin for that category on its own line, so a better in-stock rate is not credited with a margin gain it did not make.