The firm, which last year purchased Argos-owner Home Retail, said sales at stores open over a year rose 0.1 percent, excluding fuel, in the 15 weeks to Jan. 7, its fiscal third quarter.
That compared to analysts’ average forecast of a fall of 0.8 percent and a second quarter decline of 1.1 percent.
Argos’ like-for-like sales rose 4.0 percent.
“The market remains very competitive and the impact of the devaluation of sterling remains uncertain,” said Chief Executive Mike Coupe.
“However, we are well placed to navigate the external environment and remain focused on delivering our strategy.”