- Although Modern Trade remains the largest and most important channel, e-commerce is the primary growth driver in both markets
- From an industry perspective, impulse categories are leading growth: Snacking is the fastest-growing category in the UAE, while Petcare leads in KSA, with Snacking ranking second there as well
- Across both markets, we see a polarized shift toward value and premium segments, with the premium tier in the UAE emerging as the fastest-growing price segment overall
The FMCG and Tech & Durables (T&D) markets across the UAE and Saudi Arabia demonstrated resilient and evolving growth dynamics in FY 2025, as consumers balanced value-seeking behaviour with a growing appetite for premium products, according to the latest State of the Nation FY 2025 analysis.
FMCG: UAE growth driven by consumption, KSA stabilizes
In 2025, the UAE FMCG market recorded +6.8% value growth, supported by a +4.9% increase in volumes and +2.0% unit value growth, indicating consumption-led expansion. Saudi Arabia, meanwhile, saw FMCG value decline by -1.0%, as flat volumes (+0.1%) combined with a -1.1% decline in unit values, reflecting continued price pressure.
Despite Modern Trade remaining the largest FMCG channel in both markets, e-commerce emerged as the fastest-growing channel in Q4 of 25, gaining share across the UAE and Saudi Arabia as shoppers increasingly embraced online grocery platforms.
Category-level performance diverged across markets. Snacking stood out as the fastest-growing FMCG category in the UAE, while Petcare led category growth in Saudi Arabia, with Snacking ranking second.
Premiumisation and value polarisation intensify
FY’25 reinforced a clear polarisation toward value and premium FMCG brands in both markets. Premium brands were the fastest-growing price tier in the UAE, while value brands also continued to gain traction, squeezing mid-priced offerings.
This premiumisation trend was also evident in shopper attitudes, with 70% of UAE shoppers in 2025 stating they are willing to pay more for quality products, underlining strong demand for higher-end propositions despite inflationary pressures.
Tech & Durables outpace FMCG
The Tech & Durables sector outperformed FMCG across both countries in 2025. Saudi Arabia delivered +13.7% value growth, while the UAE recorded +6.3% growth, driven by strong demand during key promotional periods and sustained interest in categories such as telecom, large home appliances and consumer electronics.
Online channels continued to outperform traditional brick‑and‑mortar retail for the Tech & Durables sector in 2025, reaffirming e‑commerce as a fully established and preferred purchasing channel for technology products across both markets. This sustained growth in online sales was further driven by major promotional events including Singles Day, White and Yellow Fridays, and Cyber Monday, which accelerated consumer migration to digital platforms during the peak shopping season.
Promotions remain influential, but efficiency softens
Promotional activity remained high across FMCG in Q4 25. In Saudi Arabia, promotions increased toward the end of the year, while the UAE maintained broadly stable promotional intensity, reliant mainly on the Dubai Shopping Festival. Temporary Price Reductions (TPR) continued to dominate promotional mechanics across both markets. However, promotion efficiency declined slightly year-on-year, reflecting a more competitive promotional environment.
SKU and brand expansion accelerates in 2025
FY 2025 also saw a notable expansion in product assortments. The FMCG sector recorded 99,211 active SKUs in Saudi Arabia and 134,271 active SKUs in the UAE, while the Tech & Durables industry experienced over 20% year-on-year growth in the number of brands, largely driven by the influx of affordable and emerging players, particularly through online channels.
Andrey Dvoychenkov, General Manager Arabian Peninsula and Pakistan, adds, “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 further adds, “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, 2025 results point to a market shaped by digital acceleration, heightened promotional activity, and increasingly polarized consumer preferences creating both challenges and significant opportunities for brands and retailers across the region.
