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IKEA Turns to AI with Locus Acquisition to Boost Delivery

By  |  October 7, 2025
IKEA store

IKEA has purchased American logistics technology company Locus, a move the Swedish furniture giant says will help make its deliveries faster and more efficient as it ramps up investment in its U.S. operations. According to Reuters, both companies confirmed the deal on Tuesday, though IKEA did not disclose its value.

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    The acquisition is part of Ingka Group’s broader $2.2 billion investment push in the United States, where IKEA faces competition from major retailers such as Wayfair and Walmart. The expansion comes despite increasing costs linked to higher tariffs on imports. Locus was valued at around $300 million during its last funding round in 2021, Reuters reported.

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    Per Reuters, IKEA expects the integration of Locus’ artificial intelligence technology to simplify its logistics systems and save approximately 100 million euros ($117 million) annually in global delivery expenses. The AI-driven platform from Locus helps optimize delivery routes and group orders, replacing the current manual planning process used by IKEA employees.

    Parag Parekh, chief digital officer at Ingka Group, told Reuters that Locus’ technology will not only accelerate delivery times but also improve flexibility and customer transparency. The company plans to pilot the technology in the United States and the United Kingdom before a global rollout. “Speed is one aspect of it, but more importantly for us, it will be the flexibility, it will be the ability to track… and more importantly, through all of this, help drive a better customer experience,” Parekh said.

    Prior to the acquisition, Locus’ investors included Singapore’s sovereign wealth fund GIC, and private equity firms Alpha Wave, Tiger Global, and Qualcomm Ventures. Under the agreement, Locus will continue operating independently and maintain relationships with clients outside IKEA.

    The move aligns with IKEA’s strategic pivot toward online sales and smaller urban store formats as it adapts to changing consumer habits. According to Reuters, online purchases represented 28% of IKEA’s retail sales in its 2024 fiscal year—more than double the share from 2019.

    Just a week before the Locus announcement, Ingka Investments, IKEA’s investment arm, bought a Manhattan property for $213 million, reinforcing the company’s commitment to U.S. growth despite the trade headwinds. “In terms of the macroeconomics around us … probably there’s uncertainty on the quarters ahead,” Parekh said. “But as a company we remain committed to the U.S.”

    Source: Reuters