Investing.com -- Starbucks Corp. is creating its own software tools using artificial intelligence that could replace applications it currently purchases from Microsoft Corp. and International Business Machines Corp., Bloomberg reported Thursday citing an internal company presentation.

The coffee chain is said to be building alternatives to a Microsoft system for inventory tracking and an IBM tool for maintenance management. Some of the internally developed software could launch by the end of next year, subject to testing results.

Starbucks spends approximately $400 million annually on software, Chief Technology Officer Anand Varadarajan told workers in an internal forum earlier this year. "There's clear opportunities to reduce the spend in software," Varadarajan said.

The move is part of a broader turnaround effort to cut $2 billion in costs. The company is reviewing "every contract and service" related to technology, the presentation showed.

AI-assisted coding played a central role in developing the platform that could replace the IBM tool. Starbucks has been encouraging tech workers to use artificial intelligence, including factoring usage into their bonuses.

The company has also been working for several years on building a point-of-sale system to replace Oracle Simphony, according to the report.

The Starbucks enterprise technology team is on track to reduce its budget by about $30 million in the fiscal year ending in late September. This includes cutting approximately $10 million in software spending and saving another $13 million mostly by reducing contractors from professional services firms.

Starbucks is establishing offices in Nashville and India to house some tech workers, while others will remain at its Seattle headquarters. The company has eliminated about 2,300 jobs since February of last year, including many in technology roles.