Retail’s Holiday 2025: More Sales, Profits, And AI-Driven Commerce

Why It Matters

Late‑season shopping is set to increase, meaning retailers must manage assortment, timing of promotions and AI-enabled discovery to protect margins and capture demand.

Summary

Retailers should expect a stronger Q4 2025 holiday season with year‑over‑year sales and profits rising as consumers continue to spend despite price worries and retailers operate leaner or use AI to cut costs. Promotions will remain muted through early November but are likely to accelerate around Black Friday as overstocked merchants discount to clear inventory, amplified by five fewer shopping days between Thanksgiving and Christmas. Roughly one in five online adults plan to use AI tools to find gifts, shifting discovery and search behavior and forcing brands to adapt conversational commerce strategies. Late‑season shopping is set to increase, meaning retailers must manage assortment, timing of promotions and AI-enabled discovery to protect margins and capture demand.