Holiday sales predicted to set record

It's shaping up to be a merry holiday season for merchants. The National Retail Federation just released its annual holiday forecast. And it is predicting retail sales will surpass $1 trillion for the first time this holiday season.

The NRF expects retail sales to grow between 3.7 percent and 4.2 percent over 2024 holiday sales. That translates to between $1.01 trillion and $1.02 trillion. By comparison, last year holiday sales rose 4.3 percent over 2023 sales to total $976.1 billion.

NRF defines the holiday shopping season as running from Nov. 1 through Dec. 31 each year. "American consumers may be cautious in sentiment, yet remain fundamentally strong and continue to drive U.S. economic activity," said NRF President and CEO. "We remain bullish about the holiday shopping season and expect that consumers will continue to seek savings in nonessential categories to be able to spend on gifts for loved ones."

Mark Mathews, NRF chief economist and executive director of research, said, "The economy has continued to show surprising resilience in a year marked by trade uncertainty and persistent inflation. As tariffs have induced an uptick in consumer prices, retailers have tried to hold the line on prices given uncertainty about trade policies."

NRF's holiday forecast is based on economic modeling using various key economic indicators, including consumer spending, disposable personal income, employment, wages, inflation and previous retail sales releases. Excluded from the calculations are data involving automobile dealers and restaurants.

Average consumer spend will exceed $890

According to a survey conducted in early October 2025 by the NRF and Prosper Insights & Analytics, consumer spend on holiday gifts, food, decorations and other seasonal items is expected average $890.49 per person.

This is the second highest average in the survey's 23-year history, and falls just 1.3 percent shy of last year's record $901.99, the NRF said in a statement.

"Time and again, Americans prioritize spending on loved ones for holidays despite economic uncertainty," said Katherine Cullen, NRF vice president for industry and consumer insights. Nearly all U.S. adults (91 percent) plan to celebrate winter holidays, such as Christmas, Hanukkah or Kwanzaa this year, which is in line with past years, according to the NRF.

Of the total spend, an average $627.93 will go to gifts for family and friends. The remaining $262.56 will be spent on seasonal items like food, candy, decorations and greeting cards. "Despite consumers' economic concerns, the winter holidays remain an important occasion to celebrate with loved ones," said Phil Rist, executive vice president of Prosper. "This is particularly true for those families with children who are expected to increase their gift budgets by more than $30 on average."

Omnichannel is name of the game

As has been the case for several years, consumers plan to shop across a number destinations this holiday season. Online continues to be the top holiday shopping destination, with 55 percent of consumers surveyed by Prosper planning to shop online.

Grocery stores are a shopping destination for 46 percent of those surveyed. Department stores (44 percent) and discount stores (42 percent) are the next most anticipated shopping destinations. Prosper also found that the top gifts consumers would like to receive. These include:

• Gift cards (cited by 50 percent of those surveyed)
• Clothing or accessories (46 percent)
• Books and other media (27 percent)
• Personal care or beauty items (23 percent)
• Electronics (22 percent).

  Prosper's data is based on a survey of over 8,000 adult consumers concerning their holiday shopping plans, conducted Oct. 1 through 7, 2025.

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