The news: The number of visitors to the US is expected to plunge by 2 million compared with last year, Geoff Freeman, president and CEO of the US Travel Association, told Axios. That makes the US the “only major country in the world losing visitation,” he said.

Even hosting the FIFA World Cup—which organizers called “the biggest sporting event in history”—wasn’t enough to keep the number of overseas visitors from falling this summer. International tourism to the US declined by 2% YoY in June, 7% in July, and 11% in August, Freeman said in a separate interview with the New York Post.

Zoom out: Not only is the decline in international tourism contrary to trends in other markets, it’s also damaging to the US economy. A report by Tourism Economics estimates that the US will lose nearly $40 billion in inbound travel spending across 2025 and 2026, primarily attributing the decline to the Trump administration’s policies and rhetoric.

The pullback from Canadian visitors is particularly painful. Canadians made 3.2 million fewer visits and spent $3.3 billion less on travel to the US in 2025 as trade and geopolitical tensions caused many to choose other destinations, according to a report from Statistics Canada.

• Anti-US sentiment appears to be hardening, with 52% of Canadians surveyed in September reporting that they had canceled a trip to the US, up from 32% in February 2025, according to Abacus Data.
• The most recent trade disputes could deepen Canadians’ break with the US, as consumers build new travel and retail habits centered around non-US destinations and brands.

US businesses can’t count on domestic travelers to fill the gap. Domestic travel’s share of US bookings declined 6.4 percentage points YoY between October 2025 and August 2026, according to a FlightHub report. A number of factors—including pricier domestic airfare, strong demand for international travel, and an increasingly K-shaped travel economy—have resulted in more US tourism dollars flowing outward, giving US retailers, restaurants, and hospitality operators fewer opportunities to recoup revenues.

Implications for retail: The decline in overseas visitors adds to pressure on US retailers, restaurants, and hospitality operators already grappling with softer demand from local residents.

That puts US businesses at a severe disadvantage compared with their international counterparts, especially as more US consumers opt to spend their discretionary dollars overseas.