COMPUSERVE LOSS LESS THAN THOUGHT.

Byline: Paul Souhrada Associated Press 

CompuServe Inc. surprised Wall Street analysts Tuesday, posting a smaller loss than expected in its first quarterly report since H&R Block Inc. spun off the on-line services company.

Columbus-based CompuServe reported a loss of $1.1 million, or 2 cents a share, for its fourth quarter, which ended April 30. That compares with a loss of $58.4 million, or 79 cents a share, in the same period a year ago.

Analysts following the company had expected a loss of about 6 cents a share. CompuServe shares closed down 87-1/2 cents at $23.25 a share Tuesday on the NASDAQ Stock Market in trading before the company released its results.

Revenue climbed 31 percent to a record $215.2 million for the quarter, compared with $164.1 million for the same quarter one year earlier.

Kansas City-based Block spun off 20 percent of CompuServe in an April 18 public stock offering, saying it wanted to concentrate on its core tax preparation businesses.

Company officials attributed the quarterly loss to costs associated with the introduction of its more family friendly WOW! on-line service and to a deliberate marketing slowdown while the company developed new software for its mainstay CompuServe Information Service.

``We will significantly step up marketing efforts for CIS within the next month,'' said Bob Massey, president and chief executive officer of CompuServe.

Despite the marketing cutback, Massey said the number of CompuServe subscribers surpassed 5 million for the first time during the fourth quarter - and was up 67 percent from a year ago.

WOW! attracted 63,000 subscribers after its first full month of operation through April 30, he said.For the full year, net income was $49.1 million, or 66 cents per share.