Combined comparable store sales for electronics, accessories and boutique increased 22% and now represent 13% of our business in the quarter compared to 10% last year. Electronics was again strong in the quarter and our boutique business is starting to grow in a meaningful way as we look forward to continuing the momentum for these categories into the holiday season.
The categories I spoke of -- home video, video games, electronics, accessory and boutique -- helped partially offset the 21% comp store decline in music. The music category represented 40% of our business for the quarter, down from 48% last year.
We are encouraged by the improvement of our third-quarter comp sales as compared to the first two quarters of '07. We are also encouraged by our strong sales in home video, video games, electronics and boutique as the growth of these categories continue to soften the impact of declines in music. John will now take you through the financial results of our third quarter.
John Sullivan - Trans World Entertainment Group - CFO
Thank you, Jim. Good morning. Our net loss for the third quarter was $14.3 million or $0.46 per share. Last year, our loss before extraordinary gain was $13.3 million or $0.43 per share and after the extraordinary gain, our net loss was $11.4 million or $0.37 per share.
Our gross margin rate for the quarter decreased to 35.1% from 36.6% last year. The decrease in rate was due to fewer vendor discounts and alliances flowing through cost of sales. SG&A expenses as a percentage of sales for the third quarter was 40.8% compared to 40.4% last year, an increase of 40 basis points. The increase in rate is due to the sales decline.
EBITDA was a loss of $15 million for the quarter compared to a loss of $11.4 million last year. Our quarter-end inventory position was $569 million versus last year's $656 million. On a square foot basis, this was $98 a foot versus $102 a foot last year.
We ended the quarter with our line of credit at $82 million compared to $72 million last year due to tax payments and capital expenditures made during the year, partially offset by a lower net inventory investment.
Interest expense was $1.9 million in the quarter versus $1.7 million last year due to the higher borrowing.
During the quarter, we closed one store, repositioned three stores and did not open any new stores. We ended the quarter with 960 stores in operation and square feet totaling 5.8 million versus last year's 1121 stores and square feet totaling 6.4 million. I will now turn it back to Bob to complete our comments.
Bob Higgins - Trans World Entertainment Group - Chairman & CEO
Thank you, John. We have positive momentum in our business moving into the all-important fourth quarter and are optimistic about further improvement. We are operating in a softer retail environment and an overall gloomier economic climate and as such, we are cautious.
In closing, I reiterate our focus on our initiatives in the months ahead and our commitment to f.y.e. being the preferred destination for all things entertainment. Now I would like to open up the call to any questions anyone has. Denise?
Q U E S T I O N A N D A N S W E R
Operator
(OPERATOR INSTRUCTIONS). Ian Corydon, B. Riley & Co.
Ian Corydon - B. Riley & Co. - Analyst
Thank you. Jim was cutting out during the first part of his prepared remarks. Could you just repeat the same-store sales by category?
