Promotions and last-minute deals outweighed severe weather when it came to the U.S. holiday shopping season, with combined sales in November and December increasing 3.8 percent year-over-year to $601.8 billion, according to the National Retail Federation.

Non-store holiday sales, an indicator of online and e-commerce health, grew 9.3 percent to $95.7 billion.

“Despite facing a truncated holiday season, severe weather and shaky consumer confidence, retailers rose to the challenge and executed their strategies with proven success,” says Matthew Shay, president and chief executive officer, NRF. “Considering that retail sales are an important barometer when measuring the overall health of our national economy, this report provides a level of true optimism that the recovery is picking up steam, and once again, retail leads the way.”??

Not all retailers came out of the holiday season on top though, with the holiday discounts that drove sales cutting into profit margins. A number of major chains reported large losses at the end of 2013, including:

Despite retailers’ individual struggles, the overall picture is positive.

Total retail sales in December alone, which exclude automobiles, gas stations and restaurants, increased 0.4 percent seasonally adjusted month-to-month and 4.6 percent unadjusted year-over-year.

“Solid job growth in the months of October and November led to a more-confident consumer and healthy holiday shopping season for many retailers,” says Jack Kleinhenz, chief economist, NRF.  “While economic and policy uncertainties remain, the economy seems set for steady growth in the New Year. Undoubtedly, some of the increase came at the expense of margin. Retailers are still stressed and a long-term promotional environment may actually hurt the bottom line. As consumer confidence grows, there will be less need for retailers to heavily promote and discount their offerings.”??

December retail sales released Tuesday by the U.S. Census Bureau, which include categories such as automobiles, gasoline stations and restaurants, increased 0.2 percent seasonally adjusted month-to-month and 4.1 percent adjusted year-over-year.