A pickup in sales of digital content and the popularity of the Fifty Shades of Grey series helped Barnes & Noble Inc. (NYSE: BKS) narrow its fiscal first-quarter net loss, boosting shares in early trading today.

The company reported this morning that it lost $41 million, or $0.78 per share in the quarter. A year earlier it lost $56.6 million, or $0.99 cents per share. Revenue climbed 2% year-over-year to $1.45 billion. These results compare to the Thomson Reuters consensus estimates of a loss of $0.98 per share and revenue of $1.48 billion.

Barnes & Noble also said digital content sales grew 46%, while bookstore same-store sales increased 4.6%. The gross margin improved to 28.5% from 27.3%.

CEO William Lynch said in the release:

During the first quarter, we continued to see improvement in both our rapidly growing NOOK business, which saw digital content sales increase 46% during the quarter, and at our bookstores, which continue to benefit from market consolidation … The growth in comps at retail and the continued strong growth of our digital content business, as well as increased cost management focus, were drivers in the business turning from an EBITDA loss last year to slightly positive EBITDA in the first quarter of this year.

Shares were up more than 4% in premarket trading and opened near $12.93. The 52-week trading range is $9.35 to $26.00. Thomson Reuters had a consensus analyst price target of $20.75 before this news.

Trey Thoelcke

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