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.

"We expect the third-quarter listings decline of 2% to be more than offset by strong year-over-year revenue per listing growth of 23%," William Blair analyst Jack Murphy wrote in a note to clients on Monday. William Blair makes a market in eBay shares.

It also promises to be another strong quarter for PayPal, eBay's second-biggest money generator, which accounted for $454 million in revenue during the second quarter. PayPal's performance is even more impressive given the competition the service faces from Google's ( GOOG) rival Checkout service, which the search giant launched in 2006.

But despite forecasts that Checkout would mean doom for PayPal, PayPal continues to dominate the payment market. Global total payment volume for PayPal came in at $11.7 billion in the second quarter, growth of 32% year over year.

And Susquehanna Financial analyst Marianne Wolk forecasts PayPal will deliver payment growth of another 30% for the third quarter.

But the untold story for eBay lies in its potential to be a bigger player in the booming online ad market. Already among the most-trafficked network of Web sites, eBay is intent on furthering its reach and expanding its local Craigslist-like Kijiji service over the quarter.

American Technology Research analyst Tim Boyd predicts that revenue from the online ad segment will grow 85% year over year, a slowdown from the blistering 96% it registered in the second quarter, but still impressive.

"We believe Advertising revenue could provide a source of upside to our estimates," Boyd wrote in a research note on Tuesday. "In our view, the market is underestimating the long-term potential of the Google and Yahoo! ( YHOO) partnerships vis-a-vis the monetization of eBay's massive portfolio of ad inventory."

More from Technology

Elon Musk's Latest Twitter Tirade Is the Dumbest Thing on Wall Street

Elon Musk's Latest Twitter Tirade Is the Dumbest Thing on Wall Street

Flashback Friday: Amazon, Chip Stocks, Memorial Day

Flashback Friday: Amazon, Chip Stocks, Memorial Day

Some Companies Are Already Feeling the Effect of GDPR

Some Companies Are Already Feeling the Effect of GDPR

Experts Break Down GDPR Risks for Investors

Experts Break Down GDPR Risks for Investors

Netflix Ready to Surpass Disney as America's Most Valuable Media Company

Netflix Ready to Surpass Disney as America's Most Valuable Media Company