The FMCG and Tech & Durables (T&D) markets across the UAE and Saudi Arabia showed resilient but contrasting growth patterns in FY 2025, as consumers balanced value-conscious spending with a growing appetite for premium products, according to NielsenIQ’s State of the Nation FY 2025 report.
While Modern Trade remained the largest retail channel in both markets, e-commerce emerged as the fastest-growing channel, gaining share across the UAE and Saudi Arabia as online shopping adoption accelerated, particularly in the final quarter of the year.
UAE FMCG growth driven by higher consumption
In 2025, the UAE’s FMCG market recorded 6.8% value growth, supported by a 4.9% increase in volumes and a 2.0% rise in unit values, pointing to consumption-led expansion. In contrast, Saudi Arabia’s FMCG market saw a marginal 1.0% decline in value, as flat volume growth of 0.1% coincided with a 1.1% drop in unit values, reflecting continued pricing pressure.
At the category level, growth trends diverged across the two markets. Snacking emerged as the fastest-growing FMCG category in the UAE, while Petcare led growth in Saudi Arabia, with Snacking ranking second.
Premium and value segments gain momentum
NielsenIQ’s analysis showed a growing polarisation in consumer spending across both markets, with demand shifting toward value and premium brands at the expense of mid-priced offerings. Premium brands were the fastest-growing price tier in the UAE, while value brands also continued to gain traction.
This trend was reflected in shopper attitudes, with 70% of UAE consumers in 2025 stating they are willing to pay more for quality products, indicating sustained demand for premium offerings despite inflationary pressures.
Tech & Durables outperform FMCG
The Tech & Durables sector outpaced FMCG growth in both countries during FY 2025. Saudi Arabia recorded 13.7% value growth, while the UAE posted 6.3% growth, driven by strong demand during major promotional periods and continued interest in telecom, large home appliances and consumer electronics.
Online channels continued to outperform physical retail in the Tech & Durables segment, with sales boosted by major promotional events such as Singles Day, White and Yellow Fridays, and Cyber Monday, further accelerating the shift to digital purchasing.
Promotions remain key, but efficiency eases
Promotional activity remained elevated across FMCG in the fourth quarter of 2025. Saudi Arabia saw an increase in promotions toward the year’s end, while promotional intensity in the UAE remained largely stable, supported primarily by the Dubai Shopping Festival. Temporary Price Reductions remained the dominant promotional mechanic across both markets, although promotion efficiency declined slightly year-on-year amid heightened competition.
SKU and brand expansion continues
FY 2025 also saw a significant expansion in assortments. Saudi Arabia recorded 99,211 active FMCG SKUs, while the UAE reached 134,271 active SKUs. In the Tech & Durables sector, the number of brands grew by over 20% year-on-year, driven largely by the entry of affordable and emerging players through online platforms.
Commenting on the findings, Andrey Dvoychenkov, General Manager Arabian Peninsula and Pakistan, said, “FY data for 2025 shows that both Saudi Arabia and the UAE continue to demonstrate strong resilience, even amid evolving consumer and pricing dynamics. While Modern Trade remains dominant, it is e-commerce that is reshaping growth across FMCG and Tech & Durables.”
He added, “At the same time, we’re seeing increasingly polarized consumer behavior shoppers are actively seeking value, yet premium segments are outperforming, particularly in the UAE. This creates a complex but opportunity-rich environment for brands that can balance affordability, quality and digital execution.”
Overall, the report indicates that the region’s retail landscape in 2025 was shaped by rapid digital adoption, sustained promotional activity and increasingly polarised consumer preferences, presenting both challenges and growth opportunities for brands and retailers across the UAE and Saudi Arabia.
