Consider a pair $(X \lor Y, X)$. Let $Z = X - U$. By excision axiom, inclusion $(X \lor Y - Z, X - Z) \subset (X \lor Y, X)$ induces isomorphism in homology. As we have strong deformation retraction of $U$ on $x_0$, and since $(X \lor Y - Z, X - Z) = (U \lor Y, U)$, we get a deformation retraction of a pair $(U \lor Y, U) \to (Y, x_0)$, and the homotopy axiom says that this induces isomorphism in homology. The inverse is given by the map given by inclusion. Overall, we have that inclusion $(Y, x_0) \to (X \lor Y, X)$ induces an isomorphism. This map has an obvious left inverse $(X \lor Y, X) \to (Y, x_0)$ that contracts $X$ to a point. By easy categorical considerations, this map also must induce an isomorphism in homology.
Now consider the long exact sequence for pair $(X \lor Y, X)$:
$ \cdots \to \tilde{H}_n(X) \to \tilde{H}_n(X \lor Y) \to \tilde{H}_n(X \lor Y, X) \to \tilde{H}_{n-1}(X) \to \cdots$
The map $\tilde{H}_n(X) \to \tilde{H}_n(X \lor Y)$ is induced by inclusion $(X, x_0) \to (X \lor Y, x_0)$. There's an obvious left inverse to this inclusion, a map $(X \lor Y, x_0) \to (X, x_0)$ that contracts $Y$ in $X \lor Y$ to a point. As this map has a left inverse, the map induced in homology also has a left inverse, so it's a monomorphism, and we have an exact sequence $0 \to \tilde{H}_n(X) \to \tilde{H}_n(X \lor Y)$
Similarly, consider $\tilde{H}_n(X \lor Y) \to \tilde{H}_n(X \lor Y, X)$. As this map is also induced by inclusion $(X \lor Y, x_0) \to (X \lor Y, X)$, and from previous consideration we know that the contraction $(X \lor Y, X) \to (Y, x_0)$ induces an isomorphism, we consider a composition of these two. This map has a right inverse given by inclusion $(Y, x_0) \to (X \lor Y, x_0)$, which induces a left inverse for a map $\tilde{H}_n(X \lor Y) \to \tilde{H}_n(Y)$, which necessarily is an epimorphism. Now compose it with the inverse isomorphism $\tilde{H}_n(Y) \to \tilde{H}_n(X \lor Y, X)$ to obtain that $\tilde{H}_n(X \lor Y) \to \tilde{H}_n(X \lor Y, X)$ is also epimorphism, and thus we get an exact sequence $\tilde{H}_n(X \lor Y) \to \tilde{H}_n(X \lor Y, X) \to 0$. Remember that we composed it with the isomorphism inverse to the one $\tilde{H}_n(X \lor Y, X) \to \tilde{H}_n(Y)$ we used earlier, so here in this exact sequence, the map $\tilde{H}_n(X \lor Y) \to \tilde{H}_n(X \lor Y, X)$ is the same as in long exact sequence.
Finally, we connect these two exact sequences to get a short exact sequence:
$0 \to \tilde{H}_n(X) \to \tilde{H}_n(X \lor Y) \to \tilde{H}_n(X \lor Y, X) \to 0$
As the first map is induced by inclusion and it has a right inverse we mentioned earlier, we obtain that this s.e.s. split, so $\tilde{H}_n(X \lor Y) \simeq \tilde{H}_n(X) \oplus \tilde{H}_n(X \lor Y, X) \simeq \tilde{H}_n(X) \oplus \tilde{H}_n(Y)$.
Note that additivity axiom was not used.