China’s E-commerce Sales Rose 2.6% YoY in May, with Growth Slightly Rebounding from April

Overview

Nomura Securities released a brief commentary interpreting the retail sales data for May 2026 published by China’s National Bureau of Statistics. The key takeaway is that although overall retail sales (excluding automobiles) slowed down, China’s e-commerce sales (excluding services) showed a slight acceleration, growing 2.6% year-on-year—a significant improvement from April’s 0.2%. E-commerce penetration continued to deepen, reaching 31.6%. The report further breaks down performance across various subcategories within both essential and discretionary consumption, noting that online food and beverage maintained robust growth, while certain durable consumer goods struggled due to high base effects and the phasing out of subsidies.

Core views

Overall retail and e-commerce trends: In May, China’s retail sales (excluding automobiles) grew 1.1% year-on-year, slower than April’s 1.8%, totaling RMB 3.8 trillion. By contrast, e-commerce sales (excluding services) expanded 2.6% year-on-year, reaching RMB 1.2 trillion, a notable acceleration from April’s 0.2%. E-commerce penetration rose by 1.0 percentage point year-on-year to 31.6%, indicating that the share of online channels continues to grow steadily. Essential consumption online: Over the first five months, cumulative online food and beverage sales increased 15.5% year-on-year, roughly unchanged from the previous four months’ 15.6%, maintaining strong momentum. Online apparel sales grew 7.2% year-on-year, slightly higher than the 6.8% recorded in the prior four months. Online household goods sales rose 1.6% year-on-year, decelerating from the 2.6% seen in the previous four months. Essential consumption across all channels: In the broader retail market encompassing both online and offline channels, food sales grew 1.9% year-on-year, and daily necessities increased 1.6%, both slowing compared to April’s 4.1% and 3.5%, respectively. However, beverage sales stood out, rising 6.1% year-on-year, accelerating from April’s 3.6%. Discretionary consumption trends: PC sales saw their decline narrow from -6.9% in April to -1.5% in May. Home appliance sales fell 15.6% year-on-year, essentially unchanged from April’s -15.1%, which Nomura attributes primarily to high base effects and reduced trade-in subsidies. Smartphone sales edged up 0.7% year-on-year, a sharp slowdown from April’s 6.2%, driven largely by high base effects and rising mobile phone prices due to inflation in storage chip costs. Apparel sales grew 3.8% year-on-year, similar to April’s 3.6%. Cosmetics sales decelerated from 4.7% in April to 2.5% in May.

Analysis framework

The report employs a typical macroeconomic data-tracking and structural decomposition methodology. First, it compares changes in overall retail and e-commerce growth rates to gauge the relative health of online channels. Then, using two broad dimensions—essential versus discretionary consumption—it further disaggregates categories such as food, beverages, apparel, home appliances, and digital products, analyzing shifts in year-on-year growth rates (acceleration or deceleration) to identify structural strengths and weaknesses in consumer demand. Additionally, the report incorporates base effects and policy factors—such as trade-in subsidies—to explain the performance of specific categories like home appliances and smartphones.

Methodology notes

• industry analysis frameworkVolume-price decomposition

  Analyzing category performance by breaking down the drivers of sales growth, such as price changes and volume fluctuations

  When analyzing smartphone sales, the report mentions that ‘recent increases in mobile device prices’ were caused by ‘inflation in storage chip costs,’ implicitly considering both price and volume factors to help readers understand why sales growth has slowed significantly despite a high base.

• industry analysis frameworkSupply-demand framework

  Examining how supply-side factors—such as costs and policies—influence demand-side outcomes

  The report notes that declining home appliance sales were affected by ‘reduced trade-in subsidies,’ while rising smartphone prices resulted from ‘inflation in storage chip costs,’ illustrating the transmission mechanism through which supply-side policy and cost changes impact final sales figures.

Key data

• May e-commerce sales YoY growth rate2.6%Accelerated from April’s 0.2%
• May e-commerce sales total valueRMB 1.2 trillionExcluding service-related sales
• May e-commerce penetration rate31.6%Increased by 1.0 percentage point year-on-year
• May retail sales YoY growth rate (excluding automobiles)1.1%Slower than April’s 1.8%
• First five months online food and beverage sales YoY growth rate15.5%Essentially unchanged from the previous four months’ 15.6%
• May home appliance sales YoY growth rate-15.6%Essentially unchanged from April’s -15.1%

Impact & implications

The report suggests that the slight acceleration in e-commerce data for May indicates resilience in online channels, particularly in essential consumption areas like food and beverages. However, internal differentiation within discretionary consumption has intensified, with home appliances and smartphones facing dual pressures from high base effects and cost-driven price hikes, leading to markedly slower growth or even sustained negative growth. This could have structural implications for related e-commerce platforms and brands in the short term, warranting close monitoring of subsequent subsidy policy changes and cost pass-through dynamics.