What: Holiday e-commerce in the US surged to $257.8 billion, with smartphones, AI assistants, and buy now, pay later services fueling growth.

Why it is important: The surge in e-commerce and new payment methods builds on the momentum of omnichannel strategies and consumer demand for convenience.

Summary: US online holiday sales reached an unprecedented $257.8 billion in 2025, marking a 6.8% increase over the previous year and surpassing industry forecasts. This growth was largely fueled by a rise in mobile transactions, with 56.4% of purchases made via smartphones, reflecting consumers’ increasing reliance on mobile commerce. Generative AI-powered shopping tools and chatbots played a significant role, as traffic to retail sites from these technologies soared by over 690%, making it easier for shoppers to discover deals and research products. Flexible payment options, particularly buy now, pay later services, saw a 9.8% increase, accounting for a record $20 billion in purchases and enabling consumers to manage their holiday spending more effectively. Electronics, apparel, and furniture dominated online spending, while groceries experienced the highest year-over-year growth at 10.2%. Deep discounts across key categories further incentivised spending, illustrating how digital innovation, payment flexibility, and value-driven shopping are reshaping the holiday retail landscape.

IADS Notes: The record-breaking $257.8 billion in US online holiday sales for 2025, with over half of transactions occurring on smartphones, aligns with the broader trend of retail resilience highlighted by Inside Retail in December 2025, where US retail sales grew despite economic headwinds and omnichannel strategies proved effective. This surge was further supported by deep discounts and flexible payment options, as noted by Liontree in January 2025, which emphasised the role of AI adoption and mobile commerce in exceeding holiday sales expectations. The rapid adoption of generative AI-powered shopping tools, which drove an 830% increase in AI-driven retail traffic, was documented by Forbes in November 2025, showing significantly higher conversion rates among AI-assisted shoppers. The influence of buy now, pay later services, projected to reach $20.4 billion in spending, was detailed by Forbes in November 2025, highlighting their impact on consumer spending and loyalty. Finally, Placer.ai in December 2025 reported a pronounced shift toward value-driven shopping and heightened price sensitivity, with discount and off-price retailers outperforming traditional categories, underscoring the importance of affordability and digital innovation in the evolving holiday retail landscape.

US online holiday sales topped $257 billion, beating Adobe’s forecast