The U.S. Federal Trade Commission is investigating Instacart’s use of an artificial intelligence-powered pricing tool, according to two sources familiar with the matter, who spoke to Reuters. The probe comes amid growing scrutiny over how the grocery delivery platform uses AI to set prices for consumers. The investigation is focused on whether the algorithmic pricing system may be contributing to unfair or deceptive practices, particularly in how it adjusts prices based on user behavior, location, and demand. Instacart has faced criticism in recent months from customers and consumer advocates who claim the platform’s dynamic pricing leads to inconsistent or inflated costs for the same items across different users. Some users have reported paying significantly more for identical groceries simply because of their location, shopping habits, or device type. The FTC’s inquiry is part of a broader regulatory push to examine the use of AI in consumer-facing services, especially in industries where pricing transparency and fairness are critical. The agency is reportedly looking into whether Instacart’s AI system may be enabling price discrimination or misleading consumers through opaque algorithms. Shares in Instacart’s parent company, which is privately held, dipped following the news, reflecting investor concerns about potential regulatory fallout. While the company has not publicly confirmed the investigation, it has previously defended its pricing model as designed to reflect real-time supply and demand dynamics across its network of retailers and delivery partners. The FTC’s probe adds pressure on Instacart as it continues to expand its operations and compete with other grocery delivery services like Amazon Fresh and Walmart+. Regulators are increasingly focused on ensuring that AI-driven decisions in commerce do not undermine consumer trust or market fairness.