Q3 2026: Smaller Tickets, Bigger Bills

Even as prices on many goods and services continued to climb, people kept spending through the end of summer. Debit spend rose 7.4% and transactions rose 5.9% from Q2 to Q3, and every recurring category grew on both measures.

The Wall Street Journal recently chronicled how the “mighty American consumer” is spending more and buying more despite continued frustrations over inflation. The Q3 Debit Spend Index gives a snapshot of how spending played out for the quarter across five key categories.

Among the market conditions that shaped where dollars went: a warm summer lifted utility bills, pump prices climbed 10.7% between July and September, and back to school spending was in full swing. Households paid more for the bills that came around every month and less for the outings that did not.

Here’s what stands out:

1. Essential bills outgrew everything else. Utility spend rose 20.7% quarter over quarter on 10.8% more transactions, and the average utility payment climbed every month after June to finish 17.2% above that floor, as summer cooling bills stretched budgets. Fuel spend rose 9.9% and fuel continues to take a larger share of debit dollars than groceries, 6.3% against 5.6%.

2. Price, more than volume, drove growth in recurring billing and subscriptions. Many subscriptions got more expensive, and debit spend grew 9.7% on only 1.3% more transactions, pushing average transaction spend up 8.3%, while its share of all debit transactions slipped for a third straight quarter. Telecom led the way, with spend up 18.1% and the average telecom transaction spend 6.5% above Q2.

3. Experiences drew more visits with smaller tickets. Experience transactions grew 12.9%, more than double the total debit transaction growth in the index, while the average experience transaction spend fell 4.5% and declined in 11 of 14 subcategories. Higher-priced outings gave up the most, and sports ticketing began picking up as September opened.

People continue to use debit most often, particularly for essentials like food, fuel, pharmacy and utilities. Essentials accounted for a third (33.2%) of Q3 debit transactions and 20.5% of debit spend, compared with 32.6% and 20.5% in Q2. Spend rose 7.4% and transactions rose 7.6%, so people made more trips at about the same cost per trip. The pressure showed up in utility bills and at the pump.

The warmest summer on record and rising gas prices has energy bills squeezing consumers. Utility spend rose 20.7% from Q2 on 10.8% more transactions and reached a high in September (+12% July - Sept), and the average utility payment climbed 17.2% from June to September.

Unlike a restaurant meal or a movie ticket, a utility bill leaves little room to trade down, so more of each household’s debit dollars were committed before any other choice was made.

Fuel continued to be the largest share of all debit spend at 6.3% again edging out groceries at 5.6%. Drivers kept filling up, even while pump prices climbed 10.7% between July and September, from a national average of $3.93 to $4.33 a gallon. Overall fuel spend rose 9.9% in Q3 on 9.3% more transactions.

Groceries and restaurants. Food is where shoppers gave ground. For a second quarter, grocery and restaurant dollars lagged transactions, with average transaction spend down 1.2% at grocery stores and 3.4% at restaurants. People kept making the trip and taking the seat but left with a smaller bill, whether by buying less or choosing cheaper options. Placer.ai counted restaurant visits down 2.4% year over year in August, a different measure that shows the same pressure on dining.

While subscription transactions accounted for a smaller share of all Q3 debit transactions (15.4%, down from 16.1% in Q2 and 17.2% in Q1), people paid more, on average, for their recurring services and subscriptions. The average transaction was 8.3% higher than in Q2.

Telecom spend leads the category. Telecom spend rose 18.1% on 10.8% more transactions, with the average telecom transaction spend up 6.5%. This came during a period where phone bills are rising as major carriers retired older plans and moved customers to more expensive ones.

The cost of streaming services has been climbing too: Apple TV rose to $14.99 at the end of August and the average debit transaction cost was up 10.3% over Q2.

Digital app transactions picked up in September. At the same time, digital app spend rose 5.5% in Q3 on 4.9% more transactions, and transactions jumped 19.5% from July to September, the only category with a big volume lift during the quarter. Higher adoption of AI tools, educational and language app subscriptions are typical around back to school time.

Continuity billing drives volume. Subscription/continuity merchants grew 13.8% in transactions, the fastest in the category.

People used their debit cards more often for experiences in Q3 but paid less per transaction. Experiences made up 2.1% of Q3 debit transactions and 1.9% of debit spend, up from 1.9% and 1.8% in Q2. Transactions grew 12.9% while spend grew 7.8%, so the average experience transaction spend fell 4.5%.

Key Insight: Summer outings stayed on the calendar but big-ticket experiences gave up the most.

All eight subcategories averaging $50 or more per transaction saw average spend fall, by about 14% on average, while the six averaging under $50 declined or grew moderately from −5.9% to +3.0%. The average experience spend per transaction declined in 11 of 14 subcategories, including bicycle shops (−32%), theater ticketing (−11.2%) and tourist attractions (−7.1%).

Circana found nearly 60% of shoppers exercising greater caution or reducing discretionary spending, while 30% stayed selective but keep spending on what matters most to them.

Pro sports spend per transaction declined dramatically from Q2 (−33.3%), but a fall rebound is getting started. Transactions rose 104.5% from July to September, the bridge month from summer to the fall sports season, with MLB, the NFL and the WNBA all active, building toward the “sports equinox” in October when the NFL, MLB, NBA, NHL and others are in season at the same time.

Travel spend rose 7.4% on 9.0% more transactions, but the quarter total hides a steep path.

Key Insight: Weak air travel growth. Airlines grew least in the category compared to the prior quarter. Q2 numbers were already depressed by the TSA funding lapse (screenings down 6.7% from March to May) and the Spirit shutdown, so Q3 air travel was measured against an easy base and still grew only 2.9% (spend and transactions). Notably, TSA screened 2.7% fewer passengers from June 21 to September 7.

Early lodging demand dwindles by September. Hotels drew the most new debit transactions in travel (+16.1% from Q2, with spend up 6.3%) and then lost steam. Guests booked more stays with smaller average tickets, and debit spend declined steadily from July through September (−13.5%): the average hotel transaction spend fell 8.4%. This decline also comes on the heels of a busy July associated with the FIFA World Cup. The industry still saw September growth elsewhere, driven by heavy weekday group and corporate travel.

Travel agencies held up. Spend with travel agencies was up 14% over Q2 and held through the quarter, even as transactions dropped 19.1% by September. Fewer bookings carried more spend each.

Back-to-school spend rose 40.3% quarter over quarter on 21.2% more transactions, and the average transaction spend rose 15.8%.

Key Insight: A two-month jump. After a June trough, spend rose 80.5% in a single month from July to August, which put August 98.6% above June. All seven categories rose from July to August, from +11% for children’s wear to +109% for elementary and secondary schools.

August was the big-ticket month, as K-12 tuition and college fees come due, while September was the volume month. September had the most transactions of any month at the lowest average transaction spend on items like supplies and clothing rather than fees.

Spending at colleges and universities was the biggest single mover at +51.7%. NRF’s own data shows college spending growth of 16.6%, ahead of 9.9% for K-12 nationally. Shoppers at both levels were also looking for deals, with 32% of K-12 and 47% of college shoppers saying they would be purchasing secondhand or refurbished back-to-school materials in 2026, up from 2025.

Card on File rose again in Q3 and remained the single most-used payment method. It reached 27% of all debit transactions, up 2.0 points from Q2, and climbed each month of the quarter (26.1% in July, 26.9% in August, 27.9% in September). Digital methods together (Card on File, Card Not Present and E-Commerce) made up 62.1% of Q3 transactions, compared with 62.4% in Q2. The card saved in an app or at a merchant is taking a growing share of how debit gets used.

Within digital, Card on File gained while Card Not Present gave back 3.2 points, and tap-to-pay continued to build, with Contactless (NFC) up 1.0 point. PYMNTS Intelligence found that more than 30% of consumers recently used a mobile wallet in-store - more than double the share reported in 2024 - and Walmart began enabling tap-to-pay at select US stores on August 24.