Yes, content generated automatically sends a low-quality signal to Google and can result in a penalty.
One such automated process is the Markov stochastic model. Using this type of modeling, the software creates content based on random variables (words) – somehow better than the basic content spinners -, but ultimately the outcome is subpar content that Google dislikes and penalizes:
“Automatically generated—or “auto-generated”—content is content that’s been generated programmatically. In cases where it is intended to manipulate search rankings and not help users, Google may take actions on such content. These include, but are not limited to […] text generated through automated processes, such as Markov chains” source
We’re thinking about this a lot, but we don’t have much to say yet.
— Gary “鯨理” Illyes (@methode) July 14, 2017