• by Gavin O'Malley  @mp_gavin, February 7, 2008

Amid calls for Barry Diller's ouster, the timing couldn't have been worse for IAC/InterActiveCorp to post a fourth-quarter loss on Wednesday.

In typical fashion, Diller downplayed any threats posed by unhappy investors and poor earnings. "We will operate the company with as much focus as possible, and I do believe we will prevail," the IAC CEO said on a Wednesday conference call.

The loss was attributed to a $508.1 million operating loss at IAC's LendingTree mortgage unit.

IAC fared better in other areas, particularly online. Media and advertising revenue climbed 42% as search queries at Ask.com rose. Sales at Match.com increased by a more modest 14% due to an uptick in international subscribers.

Online sales increased at a "double-digit" pace on a percentage basis, according to IAC--while overall retailing revenue rose 3%, thanks to gains at IAC's HSN shopping network.

IAC wrote down the value of its entertainment unit by $57.2 million due to slower sales of Sally Foster products and coupon books. Overall, IAC reported a net loss of $369.9 million, compared to a profit of $15.3 million year-over-year.

In November, Diller said he intended to create separate companies for HSN, Ticketmaster, the Interval International vacation time share service, LendingTree, and a new IAC unit, including the Ask.com Internet search engine. More recently, a major investor named John Malone and his Liberty Media Corp. sought a judge's permission to remove Diller and six directors from the IAC board.

Liberty holds 30% of IAC's shares and 62% of its voting power. Liberty is claiming that Diller, who controls the voting rights of Liberty's IAC shares by proxy, is contractually obligated to vote against the breaking of IAC. IAC and Liberty are scheduled to go to trial in Delaware Chancery Court in early March.