The world's third-largest stores group, which makes over 60% of its trading profit in Britain, said sales at UK stores open over a year, excluding fuel and VAT sales tax, were up 0.1% in the 13 weeks to 25 August, its fiscal second quarter, reports Reuters.
That compares with analysts' average forecast of flat sales and represents a significant improvement on a first-quarter decline of 1.5%.
In April Tesco chief executive Philip Clarke unveiled a plan to invest £1Bn to stem a steady decline in market share to Wal-Mart Stores' Asda, J Sainsbury and Morrisons, as well as discounters Aldi and Lidl.
All that investment was largely responsible for the firm's first fall in profits in nearly two decades.
First half group trading profit fell 10.5% to £1.6Bn, while UK trading profit fell 12.4% to £1.1Bn, both in line with analysts' expectations.
The group has used the money to recruit 8,000 additional permanent staff to give customers better service, devoted more store space to food, given stores a warmer look and feel, revamped food ranges and invested more in lower prices, money-off vouchers and marketing, making better use of customer information gleaned from its Clubcard loyalty scheme.
Tesco has also increased spending on internet and smartphone services, expanded its online range and rolled out its Click & Collect service of buying online for pick up in store.
"I am encouraged by our customers' initial responses to the changes we have made but there is much more to be done," said Clarke. Group sales increased 1.4% to £36Bn.
Tesco's problems are not confined to Britain. Questions remain over its long-term commitment to US chain Fresh & Easy where trading losses narrowed by just £1M to £72M.
Also in South Korea, Tesco's biggest overseas market, legislation allowing local governments to impose shorter trading hours is hurting sales.
Separately Sainsbury posted a 1.9% rise in underlying sales for the 16 weeks to September 29, beating analysts' expectations.