Shares of Instacart Inc. (NYSE:CART) declined 6.64% in pre-market trading on Thursday, after a report that the Federal Trade Commission (FTC) is launching a probe into its AI-based pricing tool.
FTC Probes Instacart AI Pricing Tool
The FTC has issued a civil investigative demand to Instacart, requesting information about its Eversight pricing tool, Reuters reported on Wednesday.
The company did not immediately respond to Benzinga‘s request for comment.
The tool helps retailers test pricing strategies to understand shopper responses, with grocers using the tool seeing 1–3% revenue growth, according to the company.
The tool is driven by artificial intelligence and has raised concerns after a study revealed that different shoppers were being charged varying prices for the same items.
A study by Groundwork Collaborative, Consumer Reports involving 437 shoppers across four cities found a significant disparity in prices for the same items at the same stores, with some shoppers paying up to 23% more than others for identical items.
Food Price Manipulation Crackdown
This investigation into Instacart’s pricing tool comes in the wake of a broader crackdown on alleged price manipulation in the U.S. food supply chain. Earlier in the month, President Donald Trump had ordered a probe into major meatpacking companies for alleged price manipulation, citing concerns about foreign ownership and market distortions affecting U.S. ranchers and consumers.
This was followed by an executive order creating food-supply-chain security task forces within the Justice Department and the FTC to address risks from price fixing and other anti-competitive practices.
Meanwhile, for the third quarter, Instacart posted a 10% rise in revenue and gross transaction value, beating estimates, as CEO Fidji Simo emphasised a focus on affordability and highlighted the company’s enterprise platform as a key growth area.
Benzinga’s Edge Rankings place Instacart in the 49th percentile for momentum and the 57th percentile for value, reflecting its average performance in both areas. Check the detailed report here.
Price Action: On a year-to-date basis, Instacart stock climbed 5.82% as per data from Benzinga Pro. On Thursday, it rose 0.18% to close at $45.65.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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