US holiday retail sales rose 4% year over year, according to separate reports from Visa and Mastercard, signaling steady consumer spending during the critical end-of-year shopping period. The data points to continued resilience among US shoppers, even as economic pressures such as inflation, high interest rates and uneven consumer confidence shaped spending decisions.
Visa said its analysis of transactions during the holiday season showed moderate but consistent growth compared with the previous year. Spending increased across both in-store and online channels, reflecting shoppers’ continued preference for flexibility when it comes to how and where they buy. While consumers remained value-conscious, they were still willing to spend on gifts, seasonal necessities and selected discretionary items.
Mastercard’s findings echoed this trend, also reporting a 4% rise in holiday retail sales based on activity across its payments network. The company noted that spending was broadly distributed across categories, with apparel, electronics, dining and gift-related purchases playing a meaningful role in driving overall growth. The results suggest that while shoppers were cautious, they did not significantly pull back during the peak retail period.
The holiday season is closely watched by retailers and economists alike, as it typically accounts for a substantial share of annual retail revenue. This year’s growth, while more modest than some of the post-pandemic surges seen in earlier periods, indicates a stabilisation in consumer behaviour. Analysts see this as a sign that spending patterns are normalising after years of volatility caused by lockdowns, stimulus spending and supply chain disruptions.
Both Visa and Mastercard highlighted the continued shift toward digital payments. Contactless transactions, mobile wallets and other digital payment methods recorded further gains during the holiday period. Online shopping remained a key driver of sales growth, supported by early promotions, extended discount periods and improved delivery logistics. At the same time, physical stores continued to attract shoppers looking for immediate purchases and in-person experiences.
Retailers benefited from improved inventory availability compared with previous years, allowing them to meet demand more effectively. Better stock planning and fewer supply bottlenecks helped brands and stores avoid some of the shortages that had frustrated consumers in past holiday seasons. This, combined with targeted promotions, helped maintain sales momentum even as shoppers became more selective.
Price sensitivity remained a defining feature of the season. Both payment companies observed that consumers actively sought discounts and value offers, spreading purchases over a longer period rather than concentrating spending on a few peak days. Events such as early November promotions and extended Black Friday and Cyber Monday campaigns encouraged shoppers to buy earlier and more strategically.
Despite ongoing concerns around inflation and borrowing costs, the data suggests that many consumers prioritised holiday spending. Gift purchases, social gatherings and seasonal travel continued to command a share of household budgets. Analysts note that this behaviour reflects a desire to preserve traditions and experiences, even as overall financial planning becomes more cautious.
Visa and Mastercard’s reports often serve as early indicators ahead of official US government retail sales data. While the payment networks do not capture cash transactions or all forms of spending, their broad coverage provides a useful snapshot of consumer activity. Economists will compare these figures with forthcoming data from the US Census Bureau to assess the wider health of the retail sector.
The 4% growth rate also reflects a more mature phase of consumer recovery. In contrast to the sharp rebounds seen immediately after pandemic restrictions eased, recent growth has been steadier and more incremental. Retailers have adjusted expectations accordingly, focusing on profitability, inventory discipline and customer retention rather than rapid expansion.
Small and mid-sized businesses also benefited from the holiday uplift, particularly those with strong digital presences or niche offerings. Payment data suggests that shoppers continued to support a mix of national chains and independent retailers, especially when unique products or personalised experiences were available.
Looking ahead, retailers are expected to use insights from the holiday season to guide strategy in the year to come. Spending trends observed by Visa and Mastercard will influence decisions around pricing, promotions, store formats and investment in digital infrastructure. Many businesses are expected to remain cautious but optimistic, balancing growth opportunities with cost pressures.
For the broader economy, the holiday sales results point to sustained consumer engagement, even in a challenging macroeconomic environment. While growth remains moderate, the absence of a sharp slowdown has eased some fears of a significant consumer pullback. Economists say this resilience could help support overall economic stability in the months ahead.
In summary, the holiday season delivered solid, if unspectacular, growth for US retailers, with Visa and Mastercard both reporting a 4% increase in sales. The data reflects a consumer base that is cautious yet willing to spend, digitally savvy and increasingly strategic in its purchasing decisions. As retailers and policymakers digest the results, attention will now turn to how these trends evolve in the new year.
