What: US holiday retail sales rose 4.1 percent in 2025, meeting industry expectations despite economic uncertainty.

Why it is important: This record highlights the acceleration of digital transformation in retail, with mobile and AI technologies reshaping consumer behaviour.

Holiday retail sales in the United States increased by 4.1 percent in 2025, aligning with industry forecasts even as consumer confidence waned and economic pressures persisted. The season’s performance was driven by consumers’ continued willingness to spend on gifts for family and friends, supported by robust economic momentum and strategic discounting. Notably, e-commerce reached unprecedented levels, with $257.8 billion in online sales and over half of transactions completed via mobile devices. The adoption of generative AI as a shopping assistant and the widespread use of flexible payment options such as buy-now-pay-later contributed significantly to this growth, enhancing both the convenience and appeal of online shopping. Key product categories, including electronics, apparel, cosmetics, and groceries, experienced strong gains, while a decline in return rates and a surge in niche product sales reflected more intentional and value-driven consumer behaviour. These results underscore the adaptability of both retailers and shoppers, as digital innovation and evolving payment solutions continue to redefine the retail landscape.

IADS Notes: As reported by Inside Retail (Dec 2025/Jan 2026), US holiday retail sales defied weak consumer sentiment, with omnichannel strategies and discount formats driving growth. Forbes (Jan 2026) confirmed record e-commerce sales of $257.8 billion, powered by deep discounts, mobile commerce, and generative AI tools. The Economist (Dec 2025) highlighted the rapid adoption of AI-powered shopping assistants, while Forbes (Nov 2025) noted the impact of flexible payment options like buy-now-pay-later. CBS News (Dec 2025/Jan 2026) observed a shift toward value-driven, discovery-based shopping, with discount and thrift channels outperforming traditional categories and return rates declining, reflecting more intentional consumer behaviour.

US retailers hit holiday expectations with a 4.1% sales gain