Walmart ramps up focus on AI and drones: this week's biggest retail technology stories

It's Friday, the weekend is almost upon us, so let’s kick back and reflect on another eventful week for the retail tech space. Here's your briefing on the most important stories from the past few days, including Pacsun, Papa Johns, Google Cloud, JD Sports Fashion, commercetools, Zalando, Amazon, osapiens, and Otto Group.

1. Walmart and Google Gemini team on AI discovery and shopping experiences push

Walmart and Google are gearing up to launch a new experience built by Walmart and accessible directly within Gemini using the Universal Commerce Protocol.

Gemini will automatically include Walmart and Sam’s Club in-store and online products when it’s relevant. For example, when a customer asks for advice on camping equipment for the spring season, it will return items from the retailer’s inventory of products. And since people talk back and forth with Gemini, there are more opportunities to show relevant products and services throughout the conversation.

When customers discover items in Gemini, Walmart helps them move from inspiration to purchase , all within the familiar Walmart and Sam’s environments. When customers link their accounts, the retailer will recommend complementary items based on their past online and in-store purchases, combine their order with other items they’ve put in their carts, and provide all the benefits of their Walmart+ and Sam’s Club memberships.

Customers and members can get in-store and club items delivered, with hundreds of thousands of locally curated products delivered in under three hours and as fast as 30 minutes.

2. Otto Group boosts supply chain operations via NVIDIA and Reply robotics partnership

Otto Group, a digital retail and services group, is partnering with NVIDIA and Reply as it looks to improve supply chain operations through robotics.

The initiative will see a network wide deployment of a Robotic Coordination Layer, powered by NVIDIA Omniverse libraries, and Isaac Sim, across a multitude of Otto Group’s 120 logistics locations.

This connects robot fleets in the warehouse to a digital twin which displays the real-time locations and movements of all robots.

Developed by Reply, this solution uses reality capture techniques and post-processing from sensors and cameras mounted on Boston Dynamics' Spot robot as it moves through the warehouse.

Once established, the digital twin enables virtual reconfiguration of warehouse areas for process optimisation and simulations to support peak management. Concurrently, the Robotic Coordination Layer integrates with robotic fleet management tools and the WMS to coordinate and communicate with various robotic fleets, all visualised and managed within the digital twin.

3. Pacsun claims market first with launch of its social commerce app PS Community Hub

Pacsun reports the launch of its proprietary digital platform, PS Community Hub, pitched as a first to market concept.

It says that, unlike traditional retail apps or loyalty programmes, this integrates social connection, creator monetisation, and co-creation opportunities with a focus on youth culture.

The announcement was made as part of a discussion at NRF 2026: Retail's Big Show in New York City focused on Gen Alpha and Gen Z research, with Pacsun CEO Brieane Olson and Business of Fashion's Sheena Butler-Young.

"The creation of PS Community Hub demonstrates our purpose driven retail strategy, putting creators and our youth community at the heart of our plan to fuel sustainable growth, cultural relevance, and innovation in retail," says Olson.

"Our deep generational listening and Insights from the Pacsun Youth Report have been instrumental in shaping this initiative, ensuring that we address the evolving needs and aspirations of our young consumers and remain at the forefront of technology and social commerce."

4. Wing and Walmart set to expand drone delivery to 150 new stores across the USA

Wing and Walmart are expanding their drone delivery service to an additional 150 Walmart stores in the US over the next year, bringing this to more than 40 million Americans.

The pair will establish a network of over 270 drone delivery locations by 2027, stretching from Los Angeles to Miami. This builds on operations in the Dallas-Fort Worth metroplex and Metro Atlanta.

New service areas will include metropolitan hubs such as Los Angeles, St. Louis, Cincinnati, and Miami, with others to be announced at a later date. This expands on previously slated expansion markets: Houston, Orlando, Tampa, and Charlotte, which continues later this week when Wing and Walmart start operating in Houston on 15th January.

“Drone delivery plays an important role in our ability to deliver what customers want, exactly when they want it. Whether it’s a last minute ingredient for dinner or a late-night essential for a busy family, the strong adoption we’ve seen confirms that this is the future of convenience,” says Greg Cathey, Senior Vice President of Digital Fulfillment Transformation at Walmart.

“By expanding drone delivery to new major metro areas, we are helping more customers solve for their last minute needs faster than ever before.”

5. First for Papa Johns as pizza brand taps Google Cloud Food Ordering agentic solution

This week at NRF 2026, Papa Johns announced that it is the first partner for Google Cloud's newly expanded AI solution, Food Ordering agent, which is helping the pizza brand deploy a fully unified voice and text AI ordering system aimed at removing friction across customer touchpoints.

The Food Ordering agent is a part of Gemini Enterprise for Customer Experience.

Moving beyond its initial deployment in drive-thru automation, this is an omnichannel platform that enables brands to deploy voice AI agents across mobile apps, websites, telephones, kiosks, and in-car systems.

6. JD Sports Fashion first retailer to use commercetools and Stripe AI technology

JD Sports Fashion is using commercetools’ Agentic Jumpstart solution and Stripe’s Agentic Commerce Suite (ACS), with the former’s AI Hub acting as the connective foundation for agentic workflows.

It is the first enterprise retailer to deploy the ACS, connecting LLM powered shopping to checkout and payments, without replatforming or added complexity.

Its customers in the US will be able to purchase directly through AI platforms including Copilot (Microsoft), Gemini (Google) and ChatGPT (OpenAI).

“This agreement places JD right at the forefront of AI commerce. We want to reach customers wherever shopping decisions are happening, and make it easy for them to complete a purchase,” says Regis Schultz, Group CEO at JD Sports Fashion.

“As AI becomes a real entry point for commerce, our partnership with commercetools and Stripe will allow customers using AI for searches to find and transact with JD quicker and easier, at the click of a button through those channels, without adding complexity to our operations. This strengthens our digital proposition for customers, and keeps us moving in line with the fast changing retail landscape.”

“We see AI as a real opportunity to improve our customers’ experience with JD, as well as making our own operations more efficient, and so I’m really pleased that with this big step forward we are putting our words into action.”

7. Zalando taps Google’s UCP offering with new online checkout feature the first use case

Zalando is getting onboard with Google’s Universal Commerce Protocol (UCP), a new open source standard for agentic commerce that allows AI agents and merchant systems to work together.

As a first use case, UCP will soon power a new checkout feature, rolling out for eligible retailers in the US now.

Users will be able to discover and checkout Zalando’s products in AI Mode in Google Search and the Gemini app, allowing newbies to discover Zalando while offering existing ones a faster way to shop making the move from discovery to checkout seamless.

In a LinkedIn post, Zalanda said: “The UCP integration is centred on trust and built on two specific pillars: Seller of record: the retailer remains the seller, preserving their direct relationship with the customer and maintaining full control over fulfilment and service standards.”

“Secure checkout: shoppers can buy securely using Google Pay, leveraging payment methods and shipping info already saved in their Google Wallet to complete orders instantly. In the coming months, the protocol will also provide additional capabilities such as integration of loyalty. UCP can simplify the path from inspiration and discovery to purchase, while bringing maximum value to customers and brand partners.”

8. Amazon UK drone delivery flights underway in Darlington with launch set for 2026

Amazon has officially begun drone flights from its Darlington fulfilment centre as the company works towards launching the UK’s first Prime Air drone delivery service.

The MK30 drone will deliver packages up to 5lbs in under two hours to eligible Prime customers.

It operates autonomously using advanced detect and avoid technology, is claimed to be as quiet as a standard delivery van, and has backup systems that automatically take over if anything goes wrong, meeting Civil Aviation Authority safety standards. Its cameras spot and avoid obstacles in real-time, from clothes lines to trampolines, as well as people, animals, and other aircraft.

Prime Air is at an early stage in the UK. Deliveries are not yet being made, but the service is expected to officially launch in late 2026.

9. Former Google and Amazon exec Sean Scott takes on AI shopping challenge at Walmart

Walmart has appointed Sean Scott as SVP AI Shopping. He was previously GM Shopping at Google and also spent almost 15 years at Amazon, holding such roles as VP - Amazon Scout.

“Super excited to start my next chapter with one of the largest retailers in the world. Truly humbling to be part of a 60+ year old company that's still growing like a startup and still driving significant value to customers and shareholders alike. So much great progress already and so much more to come,” he says.

“We’re at a pivotal moment where AI is transforming how people shop, and yet there's so much still to figure out,” says Daniel Danker, EVP AI Acceleration, Product, and Design at Walmart.

“What is the uncompromising and transformative experience that changes how we shop, online and in-store, and truly lives up to the words "immersive" and "personalied"? How do we build trust in an agentic world? How do we serve customers wherever they are, making shopping effortless and anticipatory? And how do we use AI to empower associates so they can serve harness the technology to serve customers even better?”

He adds: “Sean has spent his career building exactly these kinds of experiences, and he’ll play a big role in helping us bring our vision to life. Welcome to Walmart, Sean, couldn’t ask for a better moment to get started!”

10. Enterprise software firm osapiens secures $100 million in funding and bags unicorn status

osapiens has entered into an agreement for Decarbonization Partners, a joint venture between BlackRock and Temasek, to lead a $100 million Series C fundraising round, subject to regulatory approvals.

Decarbonization Partners will join existing investors Goldman Sachs Alternatives, which fronted a $120 million Series B in 2024, and Armira Growth, which headed up a $27 million Series A investment in 2023.

osapiens provides software that enables companies to manage regulatory compliance, sustainability, and operational efficiency across their entire value chain on a single platform. Customers include Coca-Cola North America, Lidl, Carrefour, and OTTO.

The proceeds from the latest investment will be used to accelerate product innovation and fuel growth in existing and new international markets.

"This investment is a strong validation of our strategy and our long-term vision," says Alberto Zamora, Co-CEO and Co-Founder at osapiens. "It demonstrates that sustainable growth and AI driven efficiency remain top priorities for global investors.”

“Decarbonization Partners is an exceptional partner for us. With a focus on sustainability and the combined global presence and investment expertise of BlackRock and Temasek, they bring exactly the perspective and scale we need for our next phase of growth to become the indisputable global category leader in sustainable growth for enterprises of all sizes."