eBay Enjoys Auction Action

Skip Skype, and it's been a strong quarter for eBay(EBAY).

Glitches, viruses and finally a massive $900 million writedown that eBay took on the Internet phone service it bought in 2005 for $2.6 billion generated the most attention over the quarter.

But signs that its core auction business is showing renewed momentum -- and a stronger performance from its PayPal division -- seemed to get the bulk of investors' focus.

eBay shares are up about 15% since the company reported its second-quarter results, making eBay the second-best big-cap Internet name for the quarter, behind only ecommerce rival Amazon(AMZN).

That means eBay steps into its third-quarter earnings announcement on Wednesday after market close with a nice tailwind. And while the company's well-known businesses will face the usual scrutiny, investors also should pay close attention to efforts in the online advertising space for a glimpse of things to come.

For the quarter, analysts surveyed by Thomson Financial expect eBay to report earnings of 33 cents a share on revenue of $1.83 billion.

As always, eBay's core marketplace business -- which accounted for about 70% of second-quarter revenue -- will take center-stage. And there, eBay's efforts to boost sales by cleaning up low-quality listings so that users can more easily find what they want seem to be paying off.