eCommerce Claims 16.6% of Retail Sales as Digital Channels Grow

Estimates released by the U.S. Census Bureau on Tuesday (March 10) show that retail eCommerce sales reached $316.1 billion in the fourth quarter of 2025, increasing 1.7% from the prior quarter on a seasonally adjusted basis. Over the same period, total retail sales rose 0.4%. The trend continues, where digital commerce has expanded faster than the retail sector overall.

The same data show that eCommerce accounted for 16.6% of total retail sales during the quarter on an adjusted basis. That share reflects the continued expansion of digital channels within the retail landscape as consumers increasingly place orders or negotiate purchases through online platforms and mobile devices.

Financial Pressures Are Steering Consumers Online

The growth of online commerce is tied not only to technology adoption but also to changes in consumer financial conditions. Research from PYMNTS Intelligence indicates that financial pressure is influencing how households choose where and how to shop.

According to our data, 30% of consumers made an online retail purchase within the past 30 days, a figure that represents a 13% year-over-year increase. Over the same period, participation in in-store retail declined by six percentage points, suggesting that a portion of consumer activity is moving from physical locations to digital channels.

For many households, online shopping offers practical advantages when budgets are tight. Digital channels make it easier to compare prices, search for promotions and evaluate alternatives across merchants. PYMNTS Intelligence research also finds financially stressed consumers are more likely than their low-stress peers to purchase groceries online, indicating that digital commerce is becoming a tool for managing household spending decisions.

Payment Habits Shift Alongside Digital Shopping

Changes in payment behavior are unfolding alongside the expansion of online retail.

Digital wallets continue to gain traction, particularly among younger consumers. We found that 15% of consumers used a digital wallet for a retail purchase in November, up from 11% earlier in the year. Adoption among Generation Z consumers is considerably higher, with 36% reporting wallet usage.

Retail Growth Persists but Digital Channels Lead

Overall retail activity continued to expand during 2025, though the pace remained moderate relative to the growth seen in online channels.

According to the Census Bureau estimates, total retail sales in the fourth quarter reached approximately $1.9 trillion, increasing 0.4% from the third quarter. During the same period, eCommerce sales advanced 1.7%, widening the gap between digital commerce and the broader retail sector.

On a year-over-year basis, eCommerce sales increased 5.3% while total retail sales grew 2.7%.

On the other side of the equation, merchants are adjusting operations to accommodate a consumer base that increasingly begins the shopping journey online, even when purchases are completed elsewhere. Small businesses, meanwhile, remain cautiously optimistic about sales prospects despite uneven expectations, as can be seen in the latest data released by the National Federation of Independent Businesses on Tuesday. The latest survey indicates overall business health remains stable. In February, 67% of owners rated their business conditions as either excellent or good, while 5% reported poor conditions, indicating broadly stable operating conditions across the sector.

Overall, the data point to a retail environment in which growth persists, but the center of gravity continues to move steadily toward eCommerce.