July 30 (Reuters) - PayPal ( PYPL ) on Tuesday raised

its forecast for full-year adjusted profit for the second time,

betting on resilient consumer spending in the back-to-school and

upcoming holiday shopping seasons, while cost-cutting measures

improved margins.

American consumers have remained remarkably hardy despite

higher-for-longer interest rates burning a hole in their

pockets. Even as rival payments firms have flagged worries of

increasing pressure on the lower-income bracket, the sector

logged broadly steady growth in transaction volumes this year.

Meanwhile, under CEO Alex Chriss, the payments giant has

focused on improving operating margins by restructuring,

aggressively cutting costs and reducing its headcount. In

January, it announced plans to slash about 2,500 jobs, or 9% of

its global workforce.

PayPal ( PYPL ) now expects adjusted profit growth in a "low to

mid-teens percentage" in 2024, compared with its April forecast

of a "mid-to-high single-digit" increase.

Total payment volumes increased 11%, to $416.81 billion in

the second quarter, while net revenue climbed 9%, to $7.89

billion on an FX-neutral basis.

PayPal's ( PYPL ) operating margins expanded 231 basis points on an

adjusted basis, to 18.5% in the quarter. Its margins have been

central to investor anxiety over the past year, after

post-pandemic growth slowed.

Easing some worries, total payments volumes in branded

checkout grew roughly 6% in the second quarter. PayPal ( PYPL ) said

branded checkout, Braintree, and Venmo contributed to the

highest transaction margin dollars growth rate - a key measure

of profitability of its core business - since 2021.

Transaction margin dollars jumped 8% in the quarter, to

$3.61 billion.

The entry of Big Tech giants such Apple ( AAPL ) and Google

parent Alphabet into the digital payments space in

recent years has heightened competition, hurting PayPal's ( PYPL ) market

share.

As a result, although PayPal's ( PYPL ) unbranded businesses have

grown, weakness in its branded businesses such as Venmo has

weighed on the stock.

Soon after his appointment as CEO last year, Chriss had said

he expects to increase revenue outside of purely

transaction-related volumes and pledged to make the fintech

leaner.

PayPal ( PYPL ) also expects third-quarter revenue to grow by a

"mid-single-digit percentage", below Wall Street expectations of

an increase of around 7.5%, according to LSEG data.

Its adjusted earnings per share rose to $1.19 in the

three months ended June 30, compared with 87 cents a year ago.