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content_type:article
title:Shoppers are 'running out of steam' despite holiday sales surge
source:Yahoo Finance
content:[](http://www.reuters.com/ "Reuters")
Analysis-Strong start to online holiday shopping masks signs of a fragile U.S. consumer
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Nicholas P. Brown
Tue, December 2, 2025 at 11:40 AM PST 3 min read
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By Nicholas P. Brown
NEW YORK, Dec 2 (Reuters) - The U.S. holiday shopping season kicked off to record online sales. But underlying signs of economic fragility signal a pullback in spending could be looming.
Consumer confidence fell again in November. Still, Americans spent a record $44.2 billion online during the period retailers call Cyber Week - the U.S. shopping bonanza that runs from Thanksgiving through the following Monday - according to Adobe Analytics, which tracks shopper visits to online retail websites.
Comparable sales figures for brick-and-mortar stores were not yet available.
Record top-line sales should be taken "with a pinch of salt," said John Mercer, head of global research at consumer analytics firm Coresight. Costs have risen, in part due to [tariffs](https://finance.yahoo.com/news/live/trump-tariffs-live-updates-trump-vows-export-curbs-india-hike-on-deck-china-and-canada-envoys-visit-us-200619355.html), and wealthy shoppers "have been holding up retail all year," Mercer said.
Dig deeper, and signs of trepidatious consumers abounded over Cyber Week. Shoppers at Target and Walmart cut down on impulse purchases. More consumers than ever were tapping short-term debt from buy-now-pay-later providers, Adobe data showed. Amazon.com and other retailers extended discounts to everyday items like batteries and cleaning supplies, suggesting consumers were hunting for deals just to afford household staples, said Jack O'Leary, director of e-commerce insights at consumer intelligence firm NielsenIQ.
Surveys by market research firm Kantar show that, in the last month, the percentage of consumers who feel able to afford everyday essentials has dropped four percentage points, though the figure remains well above 2023 lows.
In a November survey by consumer analytics firm CivicScience, more than two-thirds of likely shoppers said the price impact of tariffs would affect their shopping, either spurring them to buy gifts earlier, or reducing their hauls.
Discounts were steep this year, suggesting consumers needed more motivation than usual to spend. "Sentiment reflects anxiety, behavior reflects capacity, and discounting bridges the gap," said Kent Smetters, an economics professor at the University of Pennsylvania's Wharton School.
POTENTIAL PULLBACK
Those behaviors may not signal a recession, but they illustrate "a slow erosion" of financial health for families, said Julie Craig, Kantar's vice president of shopper insights. Craig pointed to Kantar surveys showing a year-to-year decrease in the share of shoppers who say they have enough savings to weather an emergency.
In November, RBC analysts reported lower- and middle-income consumers were "running out of steam," citing flat retail spending that had followed months of front-loading ahead of tariff costs.
The impact of that exhaustion is more likely to emerge in the months after the holiday shopping season, experts say. The new year will bring more direct impacts from stressors like tariff costs, the recent government shutdown, and the related pause in SNAP benefits. "It paints a picture of an increasingly anxious shopper who may be spending in bursts, then pulling back to compensate," Craig said.
Job cuts, which could affect spending, are less common just ahead of the holidays but more common after, said Marshal Cohen, chief retail advisor at consumer research firm Circana.
Mark Mathews, chief economist of the National Retail Federation trade group, is more optimistic. Consumer sentiment has been out of sync with actual spending for about five years, and major contractions have been rare, he said.
"Consumers are trying to stretch their dollar, trading down to lower-priced stores, trying to assuage low sentiment," he said. "But what they're not doing is not spending."
(Reporting by Nicholas P. Brown; additional reporting by Chandni Shah in Bengaluru; Editing by David Gregorio)
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