U.S. holiday shoppers delivered another resilient season in 2025, with spending rising steadily as consumers embraced AI-powered discovery, omnichannel convenience, and tech-forward gifting. New data from Visa Consulting & Analytics (VCA) shows that while digital channels accelerated, physical stores remained the backbone of holiday retail.
Holiday spending climbs 4.2%
Preliminary data from the VCA Retail Spend Monitor shows that overall U.S. holiday retail spending increased by 4.2% year over year across all payment types, including cash and checks. These figures cover a seven-week period beginning November 1 and are not adjusted for inflation, giving a nominal view of consumer outlays.
The monitor draws on a subset of U.S. Visa payment network data at retail merchants, complemented by survey-based estimates for other payment methods. It excludes categories such as auto, gasoline, and restaurants, focusing on core retail activity.
Stores still dominate, but e-commerce accelerates
Despite growth in digital channels, in-person shopping remained the default choice for most consumers. Visa reports that 73% of holiday payment volume occurred in physical stores, while 27% of retail spend happened online.
At the same time, e-commerce continued to expand faster than overall spending. Online retail spending rose by 7.8%, buoyed by early-season promotions and the convenience of browsing, comparing, and buying from anywhere.
Category winners and soft spots
The VCA Retail Spend Monitor highlights clear category standouts as shoppers upgraded tech and refreshed wardrobes.
- Electronics sales jumped by 5.8%, driven by demand for high-performance devices suited to the AI era.
- General merchandise stores – the “one-stop shop” format – saw a 3.7% lift as consumers looked for convenience and basket-building opportunities under one roof.
- Clothing and accessories sales climbed 5.3%, underscoring a fashion-forward mindset even in a value-conscious environment.
- Furniture and home furnishings rose a modest 0.8%, reflecting steady but subdued demand for holiday home décor.
- Building materials and garden equipment sales declined by 1.0%, signaling a cooler season for big-ticket home improvement projects.
These results point to a shopper who is willing to invest in tech, apparel, and convenient formats, while delaying more discretionary home upgrades.
AI shapes a more intentional shopper
Wayne Best, chief economist at Visa, said, “This season also marked a turning point, with artificial intelligence shaping how people discover products, compare prices, and interact with offers.”
According to Best, shoppers who were upgrading tech, refreshing closets, or stocking up at one-stop shops benefited from retailers’ ability to deliver seamless experiences across in-store and online channels. The use of AI-powered recommendations and dynamic promotions helped them stretch discretionary spending while still finding the items they wanted.
What the Visa data means for retailers
For merchants, the VCA Retail Spend Monitor is designed as a strategic tool rather than a simple scorecard. Kate Manfred, North America head of advisory services at Visa,
said “Insights from the VCA Retail Spend Monitor help businesses adapt to changing consumer behaviors and prepare for the rapidly evolving future of commerce…”
VCA’s work is supported by a global network of thousands of consultants, data scientists, and product experts using VisaNet data, which represents over 329 billion transactions a year. In the last year alone, VCA delivered nearly 4,500 consulting engagements that helped clients realize an estimated $6.5 billion in incremental revenue, underscoring the commercial value of granular spend intelligence.
