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Galaxus Becomes Switzerland’s Largest Online Retailer, Overtaking Zalando

ZURICH – Swiss online retailer Galaxus has become the country’s largest e-commerce platform by online revenue, surpassing fashion marketplace Zalando in a shift that underscores the growing competitiveness of domestic digital retailers in Europe.

The latest annual ranking of Switzerland’s biggest online stores, compiled by Swiss e-commerce consultancy Carpathia, estimates Galaxus generated approximately CHF 2.3 billion in online sales, moving ahead of Zalando by roughly CHF 480 million. The milestone marks the first time the Migros-owned marketplace has claimed the top position in the Swiss e-commerce market.

Galaxus Claims the Top Spot in Swiss Ecommerce

The rankings also reveal the increasing scale of online retail in Switzerland, with four companies now exceeding CHF 1 billion in annual online revenue. Alongside Galaxus and Zalando, electronics retailer Digitec and international marketplace Temu have joined the billion-franc club, reflecting both sustained consumer demand and intensifying competition across digital commerce.

Four Retailers Now Generate More Than CHF 1 Billion Online

The emergence of four billion-franc ecommerce businesses highlights the continued maturity of Switzerland’s digital retail market. While established players continue to grow, newer entrants are reshaping consumer expectations through competitive pricing, broader product assortments, and enhanced digital shopping experiences.

Growth Fueled by Marketplace Expansion and Customer Demand

Galaxus’ rise has been driven by years of investment in marketplace expansion, logistics infrastructure, and product assortment. Originally focused on electronics through its sister platform Digitec, the company has steadily broadened its offering to include categories ranging from home and garden to fashion, beauty, sports equipment, and groceries. That diversification has helped position the platform as a comprehensive online shopping destination for Swiss consumers.

According to company figures, the Galaxus Group reported 17% growth in platform sales during 2025, reaching CHF 3.8 billion across all markets. The retailer also added approximately 500,000 new customers over the year, bringing its customer base to around 5 million. While Switzerland remains its core market, Galaxus has continued expanding its footprint in neighboring European countries, particularly Germany, where it has invested in localized operations and customer services.

Expansion Beyond Switzerland

Although its domestic business remains the foundation of its success, Galaxus has accelerated international growth by strengthening logistics capabilities and tailoring its marketplace to local customer needs. The company’s expansion strategy reflects a broader trend among European retailers seeking growth beyond their home markets.

Competition Intensifies Across the Swiss Ecommerce Market

Industry analysts say Galaxus’ performance reflects a broader trend in European e-commerce, where regional marketplaces are strengthening their positions by leveraging local market expertise, reliable delivery networks, and customer trust. Rather than competing solely on price, many domestic platforms have differentiated themselves through wider product availability, responsive customer support, and integrated marketplace ecosystems that connect third-party merchants with consumers.

The latest rankings also illustrate the increasingly diverse nature of Switzerland’s e-commerce landscape. While Zalando remains one of the country’s leading online retailers in fashion, newer entrants such as Temu have rapidly expanded their presence by attracting price-conscious shoppers with extensive product selections and aggressive promotional strategies. Established retailers, meanwhile, continue investing in omnichannel capabilities to meet changing consumer expectations.

What Galaxus’ Leadership Means for European E-commerce

Despite growing international competition, Switzerland remains one of Europe’s most mature e-commerce markets, supported by high internet penetration, strong purchasing power, and widespread adoption of digital payment solutions. Consumers are also placing greater emphasis on delivery speed, product availability, and post-purchase service, encouraging retailers to strengthen their logistics capabilities and invest in technology-driven customer experiences.

Galaxus’ ascent to the top of the Swiss online retail rankings signals more than a change in market leadership. It highlights the ability of regional e-commerce platforms to compete successfully against international players by combining localized expertise with scalable digital operations. As competition intensifies across Europe, retailers are expected to continue investing in marketplace expansion, fulfillment efficiency, and customer experience as key drivers of long-term growth.

For the broader European e-commerce industry, the Swiss market offers an important example of how domestic platforms can thrive in an increasingly global marketplace. While international brands continue to expand across borders, Galaxus’ success demonstrates that local knowledge, operational excellence, and sustained investment can remain powerful competitive advantages in the evolving digital economy.

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Amazon Tightens Fulfilled by Merchant Requirements Across Europe

Amazon is introducing stricter performance requirements for merchants using its Fulfilled by Merchant (FBM) program, signaling a stronger focus on delivery reliability and customer experience. The updated rules will require sellers to maintain higher delivery standards or risk having their listings deactivated on the marketplace.

Amazon has announced significant changes to its FBM policies, particularly in Germany and the United Kingdom, as it seeks to improve delivery performance and provide more accurate delivery promises to customers. Under the new requirements, sellers will need to maintain an On-Time Delivery Rate (OTDR) of at least 90 percent, with stricter enforcement measures beginning later this year.

Starting on September 1, 2026, German sellers that fail to meet the required delivery standards may see affected listings deactivated and could lose the ability to add new FBM products. Similar requirements are also being introduced for Amazon Business orders, where merchants will be expected to achieve at least a 90 percent business-hour delivery rate beginning September 30. Non-compliant listings for business customers may be removed from October 30 onwards.

Amazon is also tightening its handling time requirements. In the UK, account-level default handling times will be limited to zero-day and one-day options from July 15, 2026. Additionally, the company plans to automatically adjust handling times on products where sellers consistently outperform their own stated processing estimates.

Amazon Expands Fulfillment Requirements as New Cross-Border Regulations Take Effect

The policy updates coincide with new European Union customs regulations affecting cross-border e-commerce shipments. From July 1, 2026, merchants shipping low-value orders from outside the EU into the bloc must use approved carriers and provide enhanced customs documentation, including product-level information and Amazon’s Import One-Stop Shop (IOSS) details for eligible shipments.

The new requirements reflect Amazon’s broader strategy of raising operational standards across its marketplace ecosystem. For merchants, the changes underscore the growing importance of delivery performance, logistics efficiency, and regulatory compliance in maintaining visibility and competitiveness on one of the world’s largest e-commerce platforms.

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Flipkart Builds Proprietary E-Commerce LLMs as AI Generates Up to 40% of Its Code

Walmart-owned Flipkart is deepening its artificial intelligence strategy by developing specialised e-commerce large language models (LLMs), with AI now generating nearly 40% of the company’s software code. The move highlights the growing role of AI as a core operating layer in modern commerce platforms.

India’s e-commerce giant has deployed more than 250 AI models across its ecosystem, according to Chief Product and Technology Officer Balaji Thiagarajan. The company is integrating AI across customer experiences, seller services, engineering processes, and operational workflows, positioning itself at the forefront of AI-driven retail innovation.

Speaking to Moneycontrol, Thiagarajan revealed that approximately 35–40% of Flipkart’s software code is already being generated by AI-powered tools. The company is also building what it describes as an “agentic e-commerce platform,” combining frontier AI technologies with proprietary models tailored specifically for commerce use cases.

How Flipkart Is Applying AI Across Its E-Commerce Ecosystem

Flipkart believes its long-term competitive advantage will come from specialised e-commerce models trained on its own data and operational expertise rather than relying solely on general-purpose AI systems. The company is using AI to enhance product discovery, conversational shopping experiences, catalogue enrichment, seller tools, customer support, and internal productivity systems.

Among its AI-powered initiatives is Seller Lens, a platform that helps merchants manage and grow their businesses through AI-driven insights. Flipkart is also deploying voice-based AI agents that currently make around 90,000 personalised calls each month to sellers for payment reminders, operational updates, and business recommendations. The company expects these volumes to increase significantly in the future.

To accelerate its AI transformation, Flipkart has strengthened its leadership team by recruiting senior executives from companies including Amazon, Coupang, Tata Digital, Razorpay, Swiggy, and Mastercard. The hires span engineering, product, supply chain, and data science functions, reflecting the company’s ambition to scale AI capabilities across the organisation.

Despite the substantial investments required for generative AI, Flipkart says its current priority is governance rather than immediate financial returns. The company is focusing on areas such as content moderation, response quality, human oversight, and reinforcement learning while measuring success through business metrics including conversion rates, customer engagement, basket sizes, demand forecasting accuracy, and inventory performance.

Flipkart’s AI push comes amid intensifying competition across the global e-commerce sector, where retailers are increasingly adopting artificial intelligence to improve efficiency, personalise shopping experiences, and automate operations. The company’s strategy signals a broader industry shift toward specialised, domain-specific AI systems that can reshape how commerce platforms are built and operated in the years ahead.

Source: Moneycontrol

Artificial Intelligence Determines the New Growth Route of E-Commerce in Europe

In Europe, e-commerce is once again becoming a key growth area for retail and consumer companies following the post-pandemic normalization process. According to McKinsey’s assessment, despite macroeconomic pressures and consumers spending more cautiously due to inflation, digital commerce continues to grow. It is stated that e-commerce in Europe is growing at an annual rate of 5% to 7%, and that this growth is largely supported by marketplaces.

The Impact of AI Is Increasing in E-Commerce Competition

McKinsey emphasizes that the factor distinguishing this new growth cycle from previous periods is not only demand, but also artificial intelligence-powered capabilities. While generative artificial intelligence transforms product discovery, content production, and customer interaction, analytics systems turn pricing, product variety, and delivery processes into continuously optimized structures.

Otto CEO Boris Ewenstein stated, “AI is the next paradigm shift in e-commerce. Just like the transition from catalogs to online, from online to mobile, and from mobile to platforms, AI will fundamentally change how customers shop and how we serve them.”

Agentic Commerce Is Changing the Shopping Journey

According to the news, agentic AI is redefining e-commerce competition with systems that search for products on behalf of consumers, evaluate options, and carry out multi-stage transactions. McKinsey research shows that 38% of consumers in Europe use generative AI tools for product and service research. In addition, it is projected that by 2030, between $3 trillion and $5 trillion in revenue in global B2C retail could be shaped through agentic commerce models.

Allegro CTPO David Roberts stated that traditional shopping, hyper-personalized recommendations, and the headless commerce model, in which AI assistants shop on behalf of users across platforms, will develop in the customer journey.

Retail, Media, and Omnichannel Are Converging

According to McKinsey, the boundaries between content, media, and purchasing processes are also disappearing. Short videos, live broadcasts, and content creators are no longer only traffic sources, but also function directly as digital stores. Pandora Senior Vice President of E-Commerce Jesper Damsgaard stated, “We want every online interaction to feel as carefully crafted and designed as our jewelry.”

It is also stated that AI-powered retail media networks have become an important area of profitability for companies. The news states that retail media margins can be up to 10 times higher than core retail margins.

Operational Efficiency Comes to the Fore with AI

McKinsey states that AI can reduce transaction time in customer service by 40% to 60%, that AI-powered pricing can increase gross margins by 2 to 5 points, and that it can reduce inventory costs in the supply chain by 10% to 20%. It is stated that in the new era of e-commerce, competitive advantage will strengthen among companies that position AI not only as a tool, but as the core structure of the commercial system.

New Return Requirement for Online Stores in Europe: One-Click Cancellation Era Begins

Artificial Intelligence Is Rapidly Transforming Two Professional Groups in E-Commerce

Artificial intelligence is rapidly reshaping the employment structure in the e-commerce sector. While the debate over which jobs will be transformed has continued since large artificial intelligence models began to become widespread, recent data shows that customer service and design roles are directly affected by this change.

According to the “2026 E-Commerce Talent Market Insights” report obtained by Wall Street News from 51job, customer service positions remained the largest hiring category in the e-commerce sector in the first quarter of 2026. Despite this, these positions ranked among the areas that saw the largest year-over-year decline in job postings. A significant decrease in the number of job postings was also observed in design-focused positions.

A New Role Definition in Customer Service with Artificial Intelligence

In e-commerce, customer service has long been one of the largest employment areas for platform sellers, brand owners, and service providers. These teams carried out basic operations such as customer inquiries, after-sales support, order processing, returns, and exchanges.

However, the maturation of artificial intelligence-supported customer service systems has begun to change this picture. Intelligent systems can now manage most standard scenarios such as product recommendations, order tracking, return and exchange procedures, and the resolution of after-sales issues.

Some companies are now redefining the role of human representatives not as “problem solvers,” but as “managers of complex exceptions.” This situation shows that companies’ need for customer service personnel is shifting from simple headcount growth toward more competent operational staff.

The AIGC Effect in Design Positions

Design roles are also undergoing a similar transformation. In the past, design teams had to carry out repetitive production, revision, and delivery processes for product detail pages, marketing posters, main images, and short video content.

Today, AIGC tools can perform many basic tasks such as creating product main images, designing posters, producing short video scripts, and generating visual materials. Artificial intelligence is not completely replacing designers, but it is reducing demand for entry-level design labor.

For e-commerce companies, this change means lower content production costs and faster testing cycles. For professionals, it shows a decline in the value of roles based solely on execution skills.

Demand for Technical Talent in E-Commerce Is Increasing

According to the report, demand for technical talent related to artificial intelligence reached its highest level in the last five quarters in the first quarter of 2026. This demand more than doubled compared to the second quarter of 2025.

In China’s e-commerce sector, the core competencies over the past 10 years were supply chain management and traffic operations. In the artificial intelligence era, operational efficiency, user insights, and business decision-making skills are emerging as new areas of competition.

Cross-Border E-Commerce Employment Is Also Rising

The 51job report reveals that globalization continues to be an important driving force in e-commerce growth. In the first quarter of 2026, job postings containing the keywords “cross-border” and “overseas business” reached their highest level in the last five quarters and increased by approximately 20 percent year-over-year.

The “cross-border e-commerce operations” position has ranked among the most heavily recruited categories for many consecutive quarters. Guangzhou, Shenzhen, and Shanghai stood out as the cities with the highest hiring demand due to their mature supply chains, cross-border ecosystems, and international business infrastructures. The international growth of platforms such as TikTok Shop, Temu, SHEIN, and AliExpress is also increasing demand for overseas-focused positions. Hiring data shows that combinations such as “cross-border + operations,” “cross-border + content,” “cross-border + data analytics,” and “cross-border + artificial intelligence” are becoming increasingly critical.

The Role of AI and Human Balance in Recruitment Processes in MENA

Use of AI and Premium Logistics in E-Commerce Is Rapidly Becoming Widespread in the UAE

In the United Arab Emirates (UAE), 51% of shoppers use AI-supported chat tools; 91% of businesses use AI on their e-commerce platforms; 84% expect to increase their use of AI; 84% prefer home delivery, while 73% prefer home collection for returns; 64% have a paid delivery/returns subscription; and 73% of businesses offer this subscription.

DHL eCommerce announced the key dynamics that will determine global e-commerce growth in 2026 and beyond. According to the data from the “E-Commerce Trends Report 2026”, which is based on a survey conducted with 29 thousand online shoppers and 5 thousand 800 e-commerce businesses in 29 countries, the future of online retail in rapidly digitalizing markets such as the United Arab Emirates (UAE) will be shaped by artificial intelligence, flexible delivery options, sustainable logistics, secure payment experience and easy return processes.

DHL eCommerce’s 2026 E-Commerce Trends Report research revealed that the UAE e-commerce market is undergoing a rapid transformation with artificial intelligence, social commerce, marketplaces and premium logistics solutions. According to the research conducted with 29 thousand online shoppers and 5 thousand 800 e-commerce businesses, the UAE stands out as one of the most advanced markets in the adoption of AI-supported shopping tools.

AI Use in the UAE Is Becoming Central to E-Commerce

According to the report, 51% of online shoppers in the UAE use AI-supported chat tools while shopping. On the business side, the picture is stronger: 91% of e-commerce businesses in the UAE already use AI on their platforms. In addition, 84% of businesses expect AI use to increase further in the next 5 years.

According to DHL data, 52% of shoppers in the UAE expect to shop more through retailer websites in the next 5 years. 51% state that they will shop more on online marketplaces, 47% on mobile applications, and 37% through AI-supported chat or virtual assistants.

Delivery Preference in the UAE Remains Home-Oriented

The delivery experience plays a critical role in purchasing decisions in UAE e-commerce. According to the report, 84% of shoppers in the UAE prefer home delivery, while 73% prefer home collection for returns. However, out-of-home delivery options are also developing; 12% of shoppers use parcel lockers for delivery, while 23% use them for returns.

Premium logistics has also become mainstream in the UAE. In the UAE, 64% of shoppers have a paid delivery and returns subscription. While 73% of businesses already offer this service, 24% also plan to introduce this model.

Social Commerce Is Growing Increasingly in the UAE

On the business side, the data is as follows;

68% of UAE companies expect more customer activity through social media, 65% through applications, 64% through online marketplaces, and 59% through AI-supported chat or virtual assistants.
68% of shoppers in the UAE have made purchases through Facebook, 67% through Instagram, 57% through TikTok and 41% through YouTube.
82% of businesses have sold through Facebook, 75% through Instagram, 73% through TikTok and 52% through YouTube.
Amazon was identified as the most popular online marketplace for both shoppers and businesses in the UAE.

The UAE’s Strength Comes from a Digital Society and Strong Connections

DHL Express Middle East and North Africa CEO AbdulAziz Busbate stated that the UAE’s strength in the e-commerce market comes from high digitalization, strong global and regional connections, and a consumer base that rapidly adopts new online shopping habits. Busbate emphasized that digital platforms, flexible payment options and delivery expectations continue to shape the market, and stated that the growth foundation for businesses in the UAE is strong.

According to the report, the new competitive field of e-commerce in the UAE will not only be product price or campaign; it will be AI-supported customer experience, omnichannel sales, reliable delivery, easy returns and localized logistics solutions.

Türkiye Became Europe’s Fastest-Growing E-Commerce Market

Türkiye ranked first in terms of growth expectations in the European e-commerce market. According to the projections of Germany-based e-commerce data company ECDB for the 2025-2029 period, Türkiye became Europe’s fastest-growing e-commerce market with an expected average annual growth rate of 12.9 percent.

In the prepared top 10 list, Bulgaria followed Türkiye with an expected growth rate of 12.5 percent. Bosnia and Herzegovina and Malta shared third place with an annual growth forecast of 10 percent. Russia ranked fifth on the list with an expected growth rate of 9.8 percent, while Poland was also shown among the countries representing stable e-commerce expansion in Central Europe.

Türkiye’s Young and Digitally Open Consumer Base Played a Role in Its Ranking at the Top of the List

Türkiye’s ranking at the top of the list was driven by the country’s population of approximately 86 million, its young and digitally open consumer base, its developing marketplace ecosystem, logistics infrastructure, and the rapid spread of online shopping habits. It was stated that online spending in Türkiye reached approximately 86 billion euros last year and recorded 16 percent year-on-year growth.

It is noteworthy that the strongest e-commerce growth in Europe is concentrated particularly in Eastern and Southeastern European countries. In these regions, the fact that e-commerce is still in the development phase, digital infrastructure investments, the expansion of marketplaces, and consumers’ increasing adaptation to online shopping are among the main factors supporting growth.

Türkiye’s rise to a leading position in European e-commerce growth strengthens the country’s potential to become a regional hub in digital trade. Its rapidly growing domestic market, cross-border sales opportunities, logistics capabilities, and strong marketplace structure make Türkiye a strategic market for both local brands and international players.

E-Commerce Volume in Türkiye Exceeded 115 billion USD

German E-commerce Remains Retail Growth Engine as Marketplaces Gain Share

German e-commerce is expected to continue outperforming physical retail in 2026, but rising marketplace concentration and foreign platform sales are raising concerns among local retailers.

German e-commerce is set to remain the main growth driver of the country’s retail sector in 2026, according to the German Retail Federation, known as HDE. The federation forecasts nominal e-commerce revenue in Germany to rise by 4.3 per cent this year, reaching 96.3 billion euros. By comparison, sales generated through physical stores are expected to grow by only 1.6 percent.

The figures show that German e-commerce continues to expand faster than brick-and-mortar retail, even in a more cautious consumer environment. HDE describes online retail as the “growth engine of retail,” reflecting the increasing importance of digital channels in Germany’s consumer market.

However, the growth of German e-commerce does not automatically mean that German retailers are benefiting equally. A growing share of online spending is flowing through large marketplaces and international platforms, creating a more complex competitive picture for local merchants.

German e-commerce is expected to continue outperforming physical retail in 2026

Marketplaces remain one of the strongest forces in German e-commerce. Last year, they accounted for 56.7 per cent of all online sales in the country. Their share is expected to increase again this year, although the pace of growth has slowed. This suggests that online shoppers in Germany continue to prefer marketplace-based shopping, but the market may be entering a more mature phase.

The dominance of marketplaces reflects broader changes in consumer behaviour. Shoppers often use large platforms for product variety, competitive prices, convenient delivery, customer reviews, and simple return processes. For retailers, however, dependence on marketplaces can create pressure on margins, customer ownership, and brand visibility.

One of the key concerns raised by HDE is the role of international platforms in the German e-commerce market. The federation says a large share of online spending takes place on major international platforms without the involvement of German sellers. According to HDE, Shein and Temu together generate around 4.7 billion euros in sales in Germany.

This has intensified debate around fair competition. HDE argues that Chinese platforms such as Shein and Temu benefit from advantages that may not be equally available to European or German retailers. These concerns include product safety, customs enforcement, tax compliance, consumer protection, environmental standards, and regulators’ ability to monitor large volumes of low-value parcels entering the market.

According to HDE, 65 per cent of German consumers have purchased from a foreign online store at least once. Among those cross-border shoppers, nearly half have bought from a Chinese retailer. This means that more than three in ten Germans have experience shopping on Chinese platforms.

These figures highlight how international German e-commerce has become from the consumer side. German shoppers are no longer limited to domestic online stores or European platforms. They are increasingly comfortable buying from global sellers, especially when prices are low, and delivery options are accessible.

For German retailers, this creates a difficult competitive environment. They must compete not only with domestic rivals, but also with global platforms that operate at large scale and often use aggressive pricing strategies. Smaller online retailers may find it harder to match the product range, marketing budgets, logistics capabilities, and pricing flexibility of major platforms.

Stephan Tromp, Deputy Managing Director of HDE, said the marketplace sector remains highly dynamic and stressed the need for fair competition. He argued that policymakers should take stronger action against violations and ensure that regulations are clearly enforceable. According to HDE’s position, companies should expect that rule breaches will be detected and meaningfully penalized.

Market concentration is another major issue in German e-commerce. An increasing share of online consumer spending is going to a small number of large players, with Amazon remaining the dominant platform. Germany is Amazon’s largest European market, and the company reportedly recorded another year of strong revenue growth in the country.

This concentration has important implications for the structure of German e-commerce. Large platforms can offer scale, convenience, and advanced logistics, but their dominance can also make it harder for independent retailers to grow. In recent years, many smaller online retailers in Germany have seen revenues decline, while leading platforms have continued to expand.

The German e-commerce market therefore presents a mixed picture. On one hand, online retail remains one of the strongest areas of growth in the broader retail sector. On the other hand, the benefits of that growth are not evenly distributed. Marketplaces, international platforms, and dominant players are capturing an increasing share of consumer spending.

For policymakers, the challenge will be to support digital retail growth while ensuring fair and enforceable rules. For retailers, the challenge will be to compete in a marketplace-driven environment without losing direct customer relationships. German e-commerce remains a growth engine, but its future will increasingly depend on how competition, regulation, and platform power are managed.

Consumer Spending in Saudi Arabia Increased by 17.5 Percent with the Impact of E-Commerce

Consumer spending in Saudi Arabia recorded strong growth in April. One of the main drivers of growth in consumer spending in Saudi Arabia was e-commerce. According to the data, total consumer spending in the country increased by approximately 17.5 percent year on year, reaching 133.9 billion riyals. This figure stood out as the highest monthly growth rate recorded since May 2021.

Strong activity was observed at physical points of sale. POS sales increased by approximately 11.8 percent year on year, reaching the highest growth rate in more than two years. POS transactions represented approximately 44 percent of total consumer spending.

Although cash usage also increased, it continues to lose share within total spending. Cash withdrawals from ATMs increased by approximately 10 percent year on year, reaching 42.4 billion riyals; however, the share of cash in total spending remained at 31.6 percent.

E-Commerce Spending Accounted for One Quarter of Total Consumer Spending

One of the main drivers of growth in consumer spending in Saudi Arabia was e-commerce. As the impact of digital channels on consumer behavior increased, e-commerce spending accounted for nearly one quarter of total consumer spending. This ratio shows that online shopping has now become one of the central elements of the consumer economy in Saudi Arabia.

On a sectoral basis, the fastest growth was seen in clothing and accessories and telecommunications. Spending on clothing and accessories through POS increased by 48 percent, while telecommunications spending rose by 36 percent. The entertainment sector also maintained its momentum, growing by 19 percent in April, with total spending reaching 968 million riyals.

Saudi Arabia Leads with 94 Points in a Positive Global Digital Readiness Ranking

Saudi Retail Revenues Rise 7.3% in Q1 as E-Commerce Growth Accelerates

Saudi retail activity continued to strengthen in the first quarter of 2026, with GASTAT data showing higher trade revenues, rising employee compensation, and faster e-commerce growth across the Kingdom.

Saudi retail and wholesale trade revenues recorded solid growth in the first quarter of 2026, underscoring continued expansion in consumer activity and private-sector momentum in the Kingdom. According to preliminary data released by the General Authority for Statistics, the wholesale and retail trade revenue index increased by 7.3 percent year on year in Q1 2026.

The Latest Saudi Retail Figures

The latest Saudi retail figures point to a market that remains resilient despite changing global economic conditions. The general operating revenue index for wholesale and retail trade also rose by 0.5 percent compared with the previous quarter, reaching 124.8 points. This quarterly improvement suggests that commercial activity in the Kingdom continued to expand steadily after the end of 2025.

GASTAT said the operating revenues index for retail trade, excluding motor vehicles and motorcycles, rose by 9.6 percent year on year. Wholesale trade, excluding motor vehicles and motorcycles, increased by 5.5 percent over the same period. Meanwhile, the sale and repair of motor vehicles and motorcycles grew by 5.4 percent compared with the first quarter of 2025.

The performance of Saudi retail is closely linked to the Kingdom’s broader economic transformation agenda. Under Vision 2030, Saudi Arabia has been working to diversify its economy, increase private-sector contribution, and expand non-oil commercial activity. Wholesale and retail trade is one of the sectors that directly reflects consumer confidence, business activity, and the development of modern distribution channels.

On a quarterly basis, retail trade excluding motor vehicles and motorcycles increased by 1.3 percent, while wholesale trade rose by 1.8 percent. However, revenue from the sale and repair of motor vehicles and motorcycles declined by 3.1 percent compared with the previous quarter. This mixed quarterly performance indicates that while general trade activity remained positive, some segments faced softer short-term demand.

Labor-related indicators also showed strong growth. The Employees Compensation Index increased by 10.1 percent year on year in the first quarter. Retail trade excluding motor vehicles recorded the highest rise in employee compensation, with growth of 11.4 percent. This was followed by motor vehicles and motorcycles at 8.2 percent and wholesale trade excluding motor vehicles at 8.1 percent.

The rise in labor compensation is significant for the Saudi retail sector because it may reflect higher employment, wage growth, or stronger business activity across trade segments. Compared with the previous quarter, employee compensation in retail trade rose by 1.8 percent, wholesale trade increased by 2.2 percent, and the sale and repair of motor vehicles and motorcycles advanced by 0.5 percent.

E-commerce remained one of the strongest areas of growth. The E-commerce Sales Index climbed by 13.6 percent year on year in Q1 2026, outpacing the broader wholesale and retail trade market. This confirms that digital commerce continues to gain importance within Saudi retail, supported by changing consumer behavior, improved payment infrastructure, and stronger online marketplace activity.

Retail trade excluding motor vehicles led e-commerce growth with an 18.4 percent increase. Wholesale trade excluding motor vehicles followed with a 10 percent rise, while online sales linked to the sale and repair of motor vehicles and motorcycles grew by 3.2 percent. On a quarterly basis, e-commerce gains were more moderate, with retail rising 1.1 percent, wholesale trade increasing 0.7 percent, and motor vehicle-related online sales advancing 0.2 percent.

The Automobile Sales Index rose by 3.4 percent year on year in the first quarter of 2026, although it declined by 2.9 percent compared with the previous quarter. This suggests that vehicle sales remained stronger than a year earlier but experienced a slowdown from late 2025 levels.

Overall, the data shows that Saudi retail is benefiting from both traditional trade expansion and rapid digital transformation. The continued rise in operating revenues, employee compensation, and e-commerce sales highlights the sector’s growing role in Saudi Arabia’s non-oil economy.

For businesses, investors, and e-commerce players, the Q1 results send a clear signal: Saudi retail remains one of the most dynamic markets in the region. As digital channels expand and consumer demand continues to evolve, the Kingdom’s wholesale and retail trade sector is expected to remain a key driver of commercial growth in the years ahead.