Remember when every financial headline this fall screamed that the American consumer was tapped out, exhausted, and ready to hibernate through the holidays? Yeah, me too. I was starting to believe it myself—until the numbers from this past weekend landed like a festive slap in the face.
Turns out, reports of the consumer’s death have been greatly exaggerated. Again.
The Holiday Kickoff That Caught Everyone Off Guard
Black Friday 2025 didn’t just meet expectations—it steamrolled right past them. Retail spending (excluding autos) climbed a solid 4.1% year-over-year, according to fresh data that tracks both in-store and online transactions. That’s a meaningful acceleration from last year’s 3.4% growth, and honestly, it’s the kind of stat that makes analysts do a double-take.
The stock market certainly noticed. By Monday midday, the retail sector was having a full-on party. Abercrombie & Fitch jumped 5%, Urban Outfitters matched it, and Bath & Body Works spiked a very fragrant 10%. Even the big dogs—Amazon, Home Depot, TJX, and Nike—were all solidly green. The SPDR S&P Retail ETF (XRT) added more than 1% just that morning, pushing its five-day gain past 7%.
In my experience watching these seasonal swings, when the retail ETF moves that fast in late November, something real is happening under the hood.
Online Shopping Just Hit Another Milestone
Let’s talk about the digital side of things, because that’s where the story gets even more interesting. Shoppers dropped a record-breaking $11.8 billion online on Black Friday alone. That’s up from $10.8 billion the year before.
Yes, the growth rate cooled a bit—from 14.6% last year to 10.4% this year—but let’s be real: double-digit growth after years of explosive e-commerce expansion is still impressive. And the best part? We’re not done yet. Forecasts for Cyber Monday are pointing to $14.2 billion in sales, which would make it the single biggest online shopping day ever.
When consumers are supposedly “hurting,” they don’t usually set new spending records two days in a row.
That’s the quiet part everyone seems afraid to say out loud right now.
What People Are Actually Buying
The category winners this weekend weren’t exactly a surprise, but the strength across the board was. Jewelry led the pack—always a big holiday mover—followed closely by apparel, cosmetics, video game consoles, and home appliances.
Notice anything? These aren’t just “essential” purchases. People are buying gifts. They’re treating themselves. They’re upgrading the air fryer they’ve been side-eyeing since 2022. In other words, discretionary spending isn’t dead—it’s just been waiting for the right sale.
- Jewelry – emotion-driven gifting at its finest
- Apparel – wardrobe refreshes and “I deserve this” purchases
- Cosmetics – the ultimate affordable luxury
- Gaming consoles – big-ticket items that still flew off shelves
- Home appliances – practical upgrades disguised as gifts
This mix tells me consumers are being selective, yes—but they’re not hiding under the covers either.
The Amazon Effect Keeps Growing
Speaking of online dominance, one company continues to vacuum up an absurd share of digital dollars: Amazon. Analysts are once again calling it the top e-commerce pick heading into the final stretch of the year, and the reasons are pretty straightforward.
Faster delivery? Check. Aggressive pricing? Obviously. But the sleeper advantage this year might actually be Rufus—their AI shopping assistant that’s quietly making the experience feel almost… human? Shoppers ask questions in plain English, get curated recommendations, compare options instantly. It’s the kind of friction removal that turns browsers into buyers.
I’ve watched friends use it this weekend (“Rufus, find me a Nintendo Switch bundle under $350 with fast shipping”) and the speed is genuinely spooky. When technology makes impulse buying this seamless, well, you get record sales days.
Value Retailers Are Having Their Moment
While luxury might be taking a breather, the off-price and membership warehouse clubs are absolutely feasting. Think TJX Companies (TJ Maxx, Marshalls, HomeGoods) and Costco—these names dominated consumer traffic reports over the weekend.
Why? Because even when people have money to spend, they love feeling like they’re outsmarting the system. Finding a $300 designer jacket for $89 creates its own kind of dopamine hit. Add in the treasure-hunt atmosphere of these stores, and you understand why foot traffic remains strong.
Costco, in particular, played this season like a chess master. They started holiday promotions back in October—yes, October—rolling out targeted deals across discretionary categories well before anyone else. Early data suggests it worked beautifully.
Getting consumers into the building early matters more than ever in a promotional environment.
– Retail analyst note, December 2025
We’ll get the official readout when Costco reports November sales this week, but the anecdotal evidence from packed parking lots tells you most of what you need to know.
The Trillion-Dollar Question
Here’s the stat that stopped me cold: total U.S. holiday spending is now expected to cross one trillion dollars for the first time ever. Let that sink in. We’re talking about a seasonal number so large it has twelve zeros.
Forecasts call for 3.7% to 4.2% growth over last year—slightly slower than 2024’s pace, sure, but still solidly expansionary. After everything we’ve been through with inflation and interest rates and endless doom-scrolling about recessions, the fact that we’re about to set a trillion-dollar record feels almost defiant.
Maybe that’s the real story here. The American consumer has been counted out before—2008, 2020, 2022—and somehow keeps finding ways to spend when the deals are right and the mood strikes.
What This Means for Retail Stocks Right Now
If you’re holding retail names (or thinking about it), the early read is surprisingly bullish. The consumer isn’t charging ahead recklessly—credit card data shows people are still price-sensitive and deal-driven—but they’re clearly willing to open their wallets when the value proposition makes sense.
For investors, that translates into a few clear winners:
- E-commerce giants with logistics moats
- Off-price retailers offering perceived value
- Membership clubs that started promotions early
- Brands that leaned into AI and personalization
- Anyone with strong inventory positioning heading into December
The losers? Probably the retailers who waited too long to discount, or those stuck with excess inventory of goods consumers aren’t excited about this year.
Looking Ahead to the Rest of December
Of course, one strong weekend doesn’t make a season. There’s still plenty of shopping days left, and plenty of risks—weather, shipping delays, the inevitable return of “when will the Fed cut rates?” debates.
But if there’s one thing this kickoff proved, it’s that the consumer remains the ultimate wildcard. Economists can model and forecast and fret all they want. When the sales hit and the vibes are right, people show up.
In a year when everyone expected caution, we got celebration instead. And honestly? That feels exactly right for 2025.
The holiday shopping season is officially underway—and whatever happens next, it’s going to be fascinating to watch.
