UPDATE: U.S. holiday retail spending has surged by 4.2% year-over-year, driven primarily by e-commerce and electronics, according to new data released by Visa on December 23, 2025. Despite ongoing economic challenges, consumers are demonstrating strong confidence in their spending habits, particularly in tech and personal items.
The preliminary analysis, based on Visa payment data collected over a seven-week period from November 1, shows that online sales jumped 7.8%, marking a vital shift in shopping behavior. Michael Brown, principal U.S. economist at Visa, noted that the rise in consumer spending is surprising given the lower consumer confidence compared to last year and various economic headwinds.
In-store purchases accounted for 73% of total spending, yet the notable growth in online sales indicates a trend towards convenience and early holiday deals. Brown stated, “We are seeing consumers use AI in a big way in comparison shopping and then helping to narrow down that perfect gift.”
Electronics emerged as the strongest category with sales up 5.8%, fueled by demand for cutting-edge devices linked to the booming artificial intelligence market. Apparel and accessories also saw a healthy increase of 5.3%, while general merchandise retailers, which offer one-stop shopping experiences, recorded a 3.7% rise.
However, not all categories performed well. Spending on building materials and garden supplies dipped by 1%, and furniture and home furnishings saw a marginal increase of just 0.8%. The overall retail growth figures, while promising, are not adjusted for inflation, suggesting that the actual inflation-adjusted gains could be smaller once Consumer Price Index data is factored in.
Interestingly, a recent survey revealed that 41% of Americans are planning to cut back on their holiday spending this year, an increase of six points from 2024. Brown emphasized the significance of AI in this year’s shopping season, indicating that nearly half of consumers are leveraging this technology for comparison shopping.
As the holiday season progresses, analysts and retailers alike will be closely monitoring these spending trends, as they could have lasting implications for the retail sector in the new year. With consumers increasingly relying on digital tools and platforms, the dynamics of holiday shopping are evolving rapidly, marking a significant shift in consumer behavior.
Stay tuned for more updates as we continue to track the impact of holiday spending trends on the U.S. economy.
