A shopper browses shoes at a Skechers store in San Francisco, California, June 10, 2026. U.S inflation accelerated in May to the fastest pace in more than three years as the Iran war pushed up energy prices, outstripping Americans' pay gains.

Consumers are hoping for more travel and experiences this holiday season, but physical gifts continue to win the lion's share of their wallets, according to a new report from Visa on Thursday.

The report found that more than half of survey respondents are putting travel and live events at the top of their wish lists. Still, only 15% of those respondents are prioritizing spending on experiences for others, while 27% of them plan to favor physical gifts.

That gap between what shoppers want and what they plan to buy is largely due to higher travel costs, lower consumer sentiment and an emphasis on value, according to Michael Brown, Visa's principal U.S. economist.

"There is some interesting trade-offs there that we're seeing on the part of consumers," Brown told CNBC. "If I'm traveling more, I'm probably going to be gifting those physical goods less, so this is really the broader context."

The survey was conducted among roughly 4,660 U.S. adults ages 18 and older, designed to be representative of the broader population of consumers.

Brown said budget pressure also factors into traveling for the holidays, as Visa expects more people to celebrate the holidays "a little bit closer to home" than in the past given rising airfares and general inflation. In September, consumer prices rose 3.7% annually, driven higher by surging energy costs.

Airlines have hiked the price of plane tickets this year as their fuel costs have risen by billions of dollars due to the war in the Middle East. And even if fuel prices drop, executives have said fares are likely to stay high, with fares up more than 22% in September compared with a year earlier, according to the consumer price index.

Those trends mean consumers will likely be more intentional about where they're spending, especially as inflation drives up prices across the board.

"Consumers are aspirational. They want those experiences, they want to travel, they want to be out in the world," Brown said. "However, the economic reality is with prices rising, with economic uncertainty, they need to balance the reality of today's economic environment with those aspirations."

The report also found that only households with an income above $200,000 spent more on trips departing between Nov. 1 and early next year compared with 2025 into 2026. On the other hand, many other income groups pulled back on their travel spending.

"If you think about that segment, a lot of them own equities, and the equity market runup over the last several months has created a lot of positivity among that specific affluent demographic, and I think that's one of the factors that continues to motivate even aggregate macro spend today," Brown said.

Meanwhile, less affluent shoppers are placing an emphasis on value. Visa's consumer survey from October showed that roughly one-third of consumers with an income below $100,000 are going to switch to lower-cost brands or stores when shopping for holiday gifts this season.

Though Visa is projecting a 4.5% year-over-year increase in holiday sales growth, much of that figure is due to inflation. Without those price increases, sales are expected to rise just 1.1% this year, down from the 1.3% increase during the 2025 holiday season.

Ultimately, Brown said the survey findings may be encouraging for the broader retail scene this holiday season. With less emphasis on travel and more projected spending on physical gifts, it could boost the sector at a time when spending is under pressure.

At the same time, he said that consumers may just be expecting to spend more this holiday season because they've become accustomed to the higher prices.

"But, of course, consumers are internalizing higher prices of things, and I think that's why they're reporting higher anticipated spend this year," Brown said. "I think these numbers just need to be looked at through the lens of the inflation and particularly consumers' perception of where inflation is going to go. I think that weighed heavily on consumer psychology this season."