Nasdaq listed (REDF) has reported revenues of $$5.304 million for the Quarter ending December 30th 2008, down 27.50% from $8.32 million last quarter, and 37.78% down from $7.31 million for Q3 last year.

The company has posted a net loss of $2.75 million, owing to a 41.45% decline in India Advertising revenues, i.e. for The number of advertisers has declined from 261 in the July-September quarter, to 229 in the October-December quarter.

Q309 Rediff Snapshot

The companys profits have been declining for six quarters now, and while Chairman and CEO Ajit Balakrishnan does say that the financial crisis has impacted the domestic Indian economy and key clients like travel, job, credit card and real estate sectors. They have also been affected by a 23% year on year average depreciation of the Indian Rupee vis-a-vis the Dollar.

Rediff says that they are responding to the developments by reducing operating expenses: they say they’ve cut back on development projects  that have  long payback periods, like game development. 

Strangely, the company says it will spend between $500,000 to $1 million on advertising and promotion per quarter over the next few quarters, to support growth initiatives like mobile, Indic Languages etc. Rediff has also started running video ads on Ishare. 

Details: Financials, Earnings Release

Note:  some problem with the Rediff Earnings call; we weren’t able to ask any questions, and have requested the company for an opportunity to discuss the market situation with them.