Outlook: U.S. Ad Spending To Grow 11% As AI-Led Momentum Shapes 2026.

U.S. advertising spending is expected to grow 11% in 2025, excluding political, according to an updated forecast from Madison & Wall. The projection sharply exceeds the firm’s earlier estimate of 3.6% growth and follows a 13% year-over-year increase in the third quarter.

Madison & Wall now anticipates U.S. ad spending will rise 6.6% in 2026, or 8.9% when political advertising is included.

Social networks are among the strongest performers, with revenues projected to climb 16.6% in 2025 and 14.2% in 2026. Commerce and retail media are also expected to post robust gains. The firm forecasts commerce media spending will grow 20.4% in 2025 and 20% in 2026, while retail media is set to increase 19.4% next year and 17.9% the following year.

Traditional TV continues to contract, though connected TV remains a bright spot. Overall TV ad spending fell 11.9% in 2025 and is expected to decline another 4.4% in 2026, Madison & Wall says. CTV alone is projected to grow 14% in both years.

The firm attributes the industry’s resilience to rapid advances in artificial intelligence and the ongoing shift toward digital advertising. AI is enabling efficiency gains across the ad stack, making it easier for marketers to produce ads, personalize creative and generate insights at lower costs. It is also creating new formats, including dynamic product placements and personalized video ads, while expanding opportunities in areas such as CTV.

Digital channels continue to dominate budgets. Madison & Wall estimates digital advertising will account for 81.7% of all U.S. ad spending in 2025 and 83.7% in 2026. The consultancy says digital spending remains resilient because channels such as social media and search allow advertisers to adjust budgets quickly. Meanwhile, streaming and premium digital video are relatively insulated from broader economic pressures.

Even with continued growth, Madison & Wall says uncertainty will weigh on the ad market in 2026 as advertisers operate cautiously and overall expansion slows. Still, the firm notes that maturing AI tools and the strength of digital media give marketers options to improve performance.