Crown Media Holdings Inc. on Wednesday said it was able to reduce its second quarter loss by 87 percent, aided by an increase in subscriber fees and advertising revenue. But the company warned that advertising likely would be hit by the slower economy for the balance of the year.

The Studio City-based operator of the family oriented Hallmark Channel and Hallmark Movie Channel reported a second-quarter net loss of $5.9 million, or 6 cents a share, as revenue rose 28 percent to $71.5 million.

Crown said advertising revenues in the quarter rose 15 percent, while cost of services decreased 19 percent, and selling, general and administrative expenses were down 16 percent.

One analyst expected the company to post a loss of 14 cents a share, before one-time items, on revenue of $75.3 million, according to Reuters Estimates. Even so Crown shares closed down 37 cents, or almost 8 percent, to $4.52 in Nasdaq trading

Chief Executive Henry Schleiff said during a conference call with analysts that the networks may not be able to equal its usual 17 percent to 22 percent growth rate in advertising revenues for the rest of the year, given the slow economy.