RAPAPORT...  Third-quarter revenue for Bidz.com fell 55 percent to $24.8 million as its wholesale merchandise sales dropped 95 percent. The online jewelry auction website's general merchandise sales fell 38 percent to $23.8 million, while its net income dropped 99 percent to $39,000. U.S. sales represented 62 percent of its total revenue, while the company's international sales increased to 38 percent of the total, compared with 21 percent one year ago.

Bidz.com reported that as of September 30, 2009, it was in a "stable financial position," with approximately $30.4 million in working capital. The etailer repurchased 404,815 shares for a total of $1.4 million during the quarter, when its gross profit was approximately $7.2 million, compared with $13.3 million in the third quarter of 2008. Bidz.com's gross margin in the third quarter of 2009 increased to 29 percent, compared with 24 percent one year ago.

The number of new buyers at Bidz.com decreased by 37 percent to 34,252, but the average selling price per item rose 7 percent to $187. The number of orders per day, on average, dropped 40 percent to 1,465. The number of items sold per transaction improved by 37 percent to 4.7.

During the closing month of the quarter, Bidz.com launched its 24-hour, seven-days-per-week customer service call center and acquired the intellectual property and trademark registrations of Whitehall Jewelers, Lundstrom Jewelers, Marks Bros. Jewelers and White Star Private Label. Bidz.com also acquired Whitehall's customer mailing list, which is comprised of more than 800,000 names, addresses and transaction details.

"We are disappointed by our top-line results, yet we have managed to remain profitable through careful management of our expenses, inventory and gross margin," said Leon Kuperman, Bidz.com's president. "We believe the combination of the addition of branded products on the Bidz.com site and improved customer service has resulted in an increase in the number of items sold per transaction and average selling price per order."

David Zinberg, the company's chief executive officer (CEO), added, "While our revenues continue to be impacted by the weakness in the global economy, we are making progress in stabilizing our business by providing our customers with a large selection of quality brands at significant discounts from their retail value. The current abundance of closeouts for both branded and non-branded product has allowed us to stock up on merchandise that we believe will offer good value to our customers in the upcoming holiday season.

"The combination of our business showing increasing signs of stabilization and our improved customer service and system capabilities make us optimistic that we are capitalizing on the significant long-term opportunities for our business," Zinberg noted. "As we look ahead, we expect to resume year-over-year revenue growth and profitability in 2010."

LH