PETALUMA -- Oculus Innovative Sciences, Inc. (Nasdaq: OCLS) on Thursday reported a 5.7 percent year-over-year dip in revenue for the company's third fiscal quarter and increased expenses related to operations of its Ruthigen subsidiary.

Oculus had revenue of $3.3 million for the three months ended Dec. 31, pointing to a decline in sales in the United States, Mexico and China, the Petaluma-based developer of wound, tissue and animal care products reported after the market closed.

Oculus reported a narrower quarterly gross profit of $2.1 million, equivalent to 67 percent of product revenue, down from $2.5 million, or 73 percent, a year before.

Operating expenses increased 16 percent to $3.2 million, attributed primarily to the company's subsidiary Ruthigen, which is in the process of spinoff and planning for an initial public offering. Oculus had a $1 million operational loss for the quarter, up from $163,000 and attributed mostly to Ruthigen expenses.

On Feb. 6, Oculus said it reached a deal with Ruthigen to finance up to $760,000 more in IPO costs, to be repaid at the time of the offering.

Research-and-development costs increased by $266,000, to $775,000 in the third quarter from a year before.

Quarterly net loss was $611,000, or 37 cents a share, down from $1.9 million, or 9 cents a share, the previous fiscal year. Oculus attributed that narrowing of year-to-date losses to a $1.6 million gain from the sale of Oculus shares by the company's lender, which paid off $3 million in debt.

Revenues for the past three quarters were $10.8 million, down 10.7 percent from $12.1 million a year before.

Shares in Oculus were trading at over $3 near the close of the session Friday, down more than 4 percent from Thursday's closing price.