By Sabrina Escobar

All those fretting over whether Black Friday weekend would be a bust can let out a sigh of relief. Americans showed up en masse to take part in the national post-Thanksgiving pastime this year -- especially online.

Data from Adobe suggests that U.S. shoppers spent about $30 billion online from Thanksgiving through Sunday. The company expects consumers will spend a record $14.2 billion alone on Cyber Monday, bringing the weekend's total spend to more than $40 billion. Online spending rose 9.1% from last year on Black Friday, and increased 8.7% year over year on Saturday and Sunday together.

The positive weekend data seemed to be giving retail stocks a boost on Monday. The State Street SPDR S&P Retail exchange-traded fund, known by its ticker XRT, was gaining 1.1% in Monday trading, while the S&P 500 was down 0.2%. Some of the fund's biggest holdings, Victoria's Secret, Macy's, and Ulta Beauty, were up 4%, 2% and 3.4%, respectively.

In-person shopping had a more modest weekend, with in-store sales growing 1.7% from a year ago on Black Friday, according to Mastercard SpendingPulse, which measures both in-store and online sales. In-store visits dipped 2.1% on Black Friday from 2024, but were just under 250% higher than the prior Friday this year (Nov. 21), according to foot-traffic data from Sensormatic Solutions.

Mastercard estimates that, in total, online and in-person shopping on Black Friday rose 4.1% year over year. The data isn't adjusted for inflation, which has risen at a roughly 3% annual pace in recent months. Because of that, it's likely that price increases helped push the headline sales figures higher over the weekend.

That said, the current pace of spending still points to solid growth, wrote Michael Baker, an analyst at D.A. Davidson. The analyst maintained his forecast for total holiday sales -- the period ranging from Nov. 1 through Dec. 31 -- to increase between 3% and 4% from last year, roughly in line with forecasts made by economists and industry groups.

Retailers were hoping the weekend's discounts would be an effective way to motivate price-sensitive consumers to spend ahead of the holidays. The average online discount over the weekend was about 30% off, Adobe said, which was steeper than the 28% markdown the firm had forecast. Randal Konik, an analyst at Jefferies, said that of the 54 retailers the firm tracks, 53% increased promotions compared with last year.

It wasn't only discounts that drove spending over the weekend, wrote Dana Telsey, CEO of Telsey Advisory Group. Innovation in both products and in-store entertainment helped stimulate demand, as well. For instance, Target drove early-morning foot traffic this year by offering giveaways to the first 100 people to enter stores as doors opened on Friday. Macy's also offered a few limited-time in-store-only discounts on Friday.

"Consumers want to celebrate the holidays despite economic and macro concerns, and they continue to seek value and respond to key events, like Black Friday and Cyber Monday," Telsey wrote in a Monday note.

The weekend's performance suggests it may be time to revisit the retailer sector, Morgan Stanley analysts said, particularly shares of softlines retailers -- companies that sell items such as clothing, shoes, and home linens.

They highlight Gap-owned brands Banana Republic and Old Navy as potential Black Friday leaders, as well as Abercrombie & Fitch's Hollister brand. Morgan Stanley has an Outperform rating on Gap stock and an Equal-Weight rating on Abercrombie.

The XRT outperformed the market benchmark in November, gaining 4.8% while the S&P 500 was mostly flat. D.A. Davidson's Baker warned last week that the November bump may not last through the season. He noted that in the past 15 years, the XRT has often underperformed the broader market from Thanksgiving through the end of the year.

Baker refers to this period as the "silly season," as retail stocks can often have outsize moves in response to anecdotal information tied to store visits or other holiday observations.

Write to Sabrina Escobar at sabrina.escobar@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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December 01, 2025 13:32 ET (18:32 GMT)

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