Online consumer spending advanced 13% year-over-year in May, accelerating by 2 percentage points versus April, according to Bank of America aggregated credit and debit card data reviewed by analyst Justin Post.
That pace outstripped growth at physical retail locations, where spending increased 4% year-over-year in May. The broader acceleration in retail activity was influenced in part by higher gasoline prices, which the data show lifted overall spending comparisons.
Measured as a share of total transactions, online penetration expanded 1.8 percentage points year-over-year to 29.8% in May, indicating a larger portion of consumer purchases continued shifting to digital channels.
Post projects that online penetration gains will persist into 2026, citing improvements in service levels and the expansion of grocery delivery and pickup options as key drivers. He also cautioned that rising gasoline and other inflationary pressures could begin to weigh on discretionary categories.
Looking at a major e-commerce participant, consensus Street estimates point to North America retail sales for Amazon growing 14% year-over-year in the second quarter, which would represent a 2 percentage point acceleration from the prior quarter. Bank of America card data aligns with this trend, suggesting that online spending has accelerated roughly 1 percentage point quarter-to-date.
Amazon is scheduled to run its Prime Day promotion in June this year, compared with a July timing last year. Post retains a Buy rating on Amazon, citing continued gains in retail share and favorable exposure through its cloud business, AWS.
Outside general retail, transit-related spending rose 6% year-over-year in May, down from an 18% year-over-year increase in April. The April strength was influenced by base effects tied to New York tolling downtimes. On a quarterly basis, transit spending stands at 11% for the second quarter to date, versus 4% in the first quarter.
Restaurant spending fulfilled online has also shown positive momentum. Online restaurant spend is up 10% year-over-year quarter-to-date, marking a 2 percentage point acceleration compared with the full first quarter. Online grocery purchases have increased 6% year-over-year in the second quarter to date, holding steady relative to the first quarter.
Category-level acceleration in May was uneven. Electronics posted the largest month-over-month shift, with year-over-year growth rising 10 percentage points from April. Department stores and sporting goods each accelerated by 4 percentage points. Conversely, transit recorded the largest deceleration, with year-over-year growth slowing by 12 percentage points from April.
Key takeaways
- Online spending accelerated to 13% year-over-year in May, increasing online penetration to 29.8%.
- E-commerce growth outpaced brick-and-mortar retail, while higher gasoline prices contributed to overall retail acceleration.
- Amazon is projected to report stronger North America retail growth in Q2, supported by earlier Prime Day timing and card-data trends.
Impacted sectors: E-commerce/retail, consumer discretionary, transportation and foodservice.