By Helen Reid and Yadarisa Shabong

(Reuters) - Burberry reported a smaller than expected 4% drop in quarterly comparable store sales on Friday, helped by stronger holiday season demand in the United States, an encouraging step in the British luxury brand turnaround efforts.

Traders said Burberry shares, up more than 80% since September, were expected to rise around 10% at the market open.

CEO Joshua Schulman, who took over at the struggling brand six months ago, said Burberry's festive advertising campaigns, which highlighted its trademark trench coats and scarves more than bags and shoes, resonated with a broad range of customers.

Schulman's strategy is to put the focus on Burberry's best-known products to win back customers he said were alienated by less recognisable designs and higher prices.

"While we recognise we are still early in our transformation, we are encouraged by the response from customers and partners over the festive period," the company said in a statement.

Analysts had expected a 12% decline in comparable sales for the company's third quarter, which runs to Dec. 28.

"We view these results as a first (and early) step in the right direction," RBC analysts said in a note.

The Americas was the only region that grew, with sales up 4% in the quarter. Burberry said New York, where the brand opened a refurbished store on 57th Street, performed well.

But every region delivered an improvement from the previous quarter. Asia Pacific sales were down 9% after a 28% decline in the second quarter, while Europe, Middle East, India and Africa (EMEIA) sales were down 2%, against a 10% fall previously.

Burberry said it was now more likely that it would make a profit over its financial year, expecting to offset the adjusted operating loss of 41 million pounds ($51 million) it reported in the first half.

($1 = 0.8074 pounds)

(Reporting by Yadarisa Shabong in Bengaluru and Helen Reid in London. Editing by Mark Potter)