Rediff has registered a 43 % decline in Q2 revenues at $4.19 Millions compared to $ 7.32 Mn recorded in corresponding quarter last year. The company has also declared a net loss of $2.61 Mn against a loss of $ 0.42 Mn last year.
Sequentially the revenues are down 16 per cent and profitability has worsened. Rediff reported revenues of $4.96 Mn. in june quarter along with net loss of $1.43 Mn. The operating expenses are up by a little margin but lower than the company prediction of $1-1.5 Mn increment for few quarter in a row.
Rediff has seen a decline in revenues at a time when advertising spends are on rise and is seeing heavy allocation for Online media although it should still be noted that it went for a total revamp doing away with all homepage ads. The advertising revenues were down 21 per cent sequentially but witnessed a 10 % rise in U.S revenues. One must admit that they made a big move by removing ads from homepage but then why have popups? Which is worse? Ads on homepage or popups? Try rediff.com and find out for yourself.
What does management say?
The company management believes that the hiccups caused in advertising revenues are temporary and was necessary to ensure future business viability. The company’s flagship portal is also seeing a influx of new features and as such company is focusing on revitalizing site’s current features & layout along with great impetus to social media services.
Focusing More on Innovation and Social Features:
Rediff is one of the many portal which have gone for a revamp in recent past and enabled social interactions on their site to increase user activity along with Yahoo and MSN. Rediff is approaching a ‘MyPage’ section which allows user to socially utilize its portal.
The company at the same time is introducing some innovative feature additions in finance and homepage to gain new user base. It recently acquired stake in Imere technologies, a hint at lot more diversification to come.
Sify, a rediff competitor has been focusing on enterprise services in past and this has pelted good growth for the company. For rediff there is not much scope in enterprise services and the only way out is to improve its Online services.
WATBlog earlier reported that returning to profitability is going to be a slow ride for rediff as it will require few more quarters to adjudge its re-alignment in portal and to gauge complete user reactions. The next few quarters may see rediff posting stagnant revenues as it will look after enabling more social features on its portal.
