Holiday Spending Trends
U.S. holiday retail spending rose 4.2% year-over-year for the seven weeks starting November 1, 2025, as reported by Visa. The figure, based on preliminary data, does not account for inflation, leaving real growth at approximately 2.2%. E-commerce sales were the primary driver, increasing by 7.8% while in-store purchases accounted for 73% of the total spending.
E-Commerce’s Dominance
The rise in e-commerce is notable, making up 27% of total holiday spending. This shift reflects a consumer preference for convenience and the impact of early promotions. Visa’s analysis indicates that consumers are increasingly utilizing AI tools for price comparison and product discovery, effectively changing their shopping behaviors. Approximately half of surveyed consumers reported using AI for holiday shopping tasks, marking a significant trend in purchasing dynamics.
Electronics as a Key Category
Electronics emerged as the standout category, with a 5.8% increase in sales. This growth stems from a refresh cycle driven by demand for high-performance devices such as laptops and smartphones. As consumers prioritize tech upgrades over home projects, the influence of AI tools on purchasing decisions cannot be overlooked. Visa noted this as the first holiday season where AI played a substantial role in consumer purchasing choices.
Consumer Behavior Insights
Despite economic uncertainties, consumer spending exhibited resilience. A disconnect exists between spending intentions and actions; while 41% of consumers indicated plans to reduce holiday spending, actual expenditures suggest otherwise. Shoppers focused on personal goods and technology, indicating a shift away from home improvement projects, which saw a decline in spending.
Global Comparisons
The U.S. growth aligns with trends observed in other Visa-monitored markets: the UK at 3.6%, Australia at 5.0%, and Canada at 4.4%. This global perspective underscores a common resilience among consumers, particularly in electronics and apparel, revealing technology’s ongoing influence on discretionary spending.
Looking Ahead
With consumers navigating economic uncertainties and adapting to new shopping modalities, expect a continued focus on tech and personal goods in the upcoming quarters. The integration of AI in shopping processes is likely to escalate, compelling businesses to refine their marketing strategies accordingly. Expect spending to moderate as inflationary pressures persist, but the adaptability of consumers suggests a steady demand for innovative products and services.
