Dec 26, 2024 - Business

Holiday retail sales rise 3.8%, Mastercard says

Holiday season retail sales rose 3.8% this year over last, Mastercard says, as more people dined out and bought clothes and jewelry.

Why it matters: The report suggests a resilient consumer, key to the continued health of the U.S. economy.

The growth rate is a little stronger than the forecast from the National Retail Federation, which suggests some upside to the season.

By the numbers: Mastercard's SpendingPulse survey reports retail sales from Nov. 1 to Dec. 24.

Excluding autos, in-store sales rose 2.9% over 2023, while online sales rose 6.7%.
Sales grew 6.3% for restaurants, 4% for jewelry, 3.7% for electronics, and 3.6% for apparel.

Yes, but: It remains to be seen how many of those purchases get returned, which could dent retailers' bottom lines.

Per the National Retail Federation, retailers expect almost 17% of what they sold this calendar year to be returned.

The intrigue: While the top-line numbers were strong, they also illustrate the slow decline of bricks-and-mortar shopping.

Almost all the growth in apparel sales was online; in-store sales only grew 0.2%.
Department stores in general underperformed, with sales rising just 1.6%.
Just in the last week, The Container Store filed for bankruptcy protection and both Party City and Big Lots said they would shut down.