UPDATE 3-Barnes & Noble results beat view; outlook raised

* Q1 loss per share $0.04; Street expected loss of $0.15

* Sees Q2 EPS $0.05-$0.15; same-store sales down 5-7 pct

* Ups full-year EPS view to $1.10-$1.40 from $0.95-$1.25

* Shares up 2 percent (Adds company and analyst comments, byline; changes dateline from NEW YORK)

By Brad Dorfman

CHICAGO, May 21 (Reuters) - Barnes & Noble Inc (BKS.N: Quote, Profile, Research) reported a narrower-than-expected quarterly loss and raised its full-year outlook on Thursday, boosted by cost-cutting and sales that fell less than planned in a weak book retail market.

Shoppers have been paring back on nonessential items, including books, in the recession, while online competition has also pressured sales at traditional bookstores.

Barnes & Noble has been no exception but has been focusing on cutting expenses, like store payrolls, and keeping inventory in check.

"They've been managing their business really well," Morningstar analyst Joseph Beaulieu said, noting that gross profit margin was nearly flat despite lower sales, while expenses as a percentage of sales fell.