Chief executive Dave Lewis said the company had enjoyed “sustained strong progress” and would “become more competitive for customers”.
Morrisons also hailed its strongest festive sales growth for seven years, enjoying a 2.9% boost for the nine weeks up to January 1.
British retailers revelled in a better than expected Christmas overall.
Alarm bells rang after Next suffered a dismal slump but worries proved unfounded.
Primark owner Associated British Foods said sales jumped a whopping 22% in the 16 weeks to January 7.
Meanwhile M&S revealed a return to sales growth in its embattled clothing arm for the first time in nearly two years.
Like-for-like sales in its clothing and home division rose 2.3% in the 13 weeks to December 31.
M&S Chief executive Steve Rowe said “better ranges, better availability and better prices” had given it a boost.
But John Lewis warned of rising prices from the weak pound despite a 2.7% rise in Christmas sales.
Meanwhile Asda was crowned cheapest supermarket of 2016 among the major UK grocers.
Which? research found a basket of 80 popular items cost on average £154.14, followed by Morrisons at £160.19.
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