CompuServe reports losses

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CompuServe reported major revenue losses and close to a 9% loss in domestic subscribership on its flagship service, according to its statement of results for the fiscal year ended April 31, 1997. CompuServe lost $119.8 million on revenues of $842 million during fiscal 1997. During the same period ended April 30, 1996, the company reported earnings of $49.1 million on revenues of $793 million.

According to company statements released June 18, CompuServe's Chairman and acting CEO Frank Salizzoni attributed a U.S. decline in subscriber numbers--from 1.65 million at the end of its third quarter to 1.52 million at the end of the fourth quarter--to a cutback in direct marketing efforts during the last quarter. Furthermore, Mr. Salizzoni attributes the reduction in direct marketing activity to a restructuring of the company's marketing programs for business, technical and professional users.

In good news for the company, its corporate network services business increased, with revenues for the year ended April 30 up 30% to $257.6 million over the prior year's $198.8 million. During the last quarter of fiscal 1996-1997, network business grew 27% over the prior year's to $69.5 million.

Copyright June 1997, Crain Communications Inc.

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