I don't understand how anyone could possibly think gen 3 in the 3rd quarter is even a remote possibility. There more to be done. PvP and trading were both worked out and outlined as goals for this year.
I'm not sure which they'll be ready for first. Slashing Pokémon seems to be the newest fight in illegitimate accounts, following the shadow banning play. These are moves they want before trading. Haxed accounts with all this Uber crap would destroy this concept before it even got off the ground and Niantic wants to kill it as much as possible.
The new gym rework and raids. Seem to probably come with new battling concepts that would very likely form the core of PvP. Increased interpersonal connections in the game suggest this too.
Which one? They want both, by year's end, but that'll be tricky.