July 29 (Reuters) - PayPal ( PYPL ) raised its full-year

profit forecast above Wall Street estimates on Tuesday, as the

digital payments giant's push to revive growth in high-margin

businesses such as Venmo and U.S. checkout begins to pay off.

Under CEO Alex Chriss, PayPal ( PYPL ) has shifted its focus to

profitability rather than chasing top-line growth. The company

is trying to regain momentum in parts of its business that lost

steam after the pandemic-era e-commerce boom faded and

competition intensified.

PayPal's ( PYPL ) Venmo, a platform that has become virtually

synonymous with peer-to-peer payments in the U.S., posted

revenue growth of 20% for the second quarter. The unit's total

payment volume growth accelerated to its highest rate in three

years.

On a per-share basis, the payments firm now expects an

adjusted annual profit in the range of $5.15 to $5.30 versus its

prior expectations of $4.95 to $5.10. Analysts on average had

expected $5.10, according to estimates compiled by LSEG.

Transaction margin dollars - the profit PayPal ( PYPL ) makes on

each transaction after covering direct costs - grew 7% to $3.8

billion in the quarter.

The increase reflects an ongoing push to drive higher-margin

volumes across the company's branded checkout products and

streamline costs tied to unbranded processing.

Adjusted operating margins expanded 132 basis points to

19.8%.

Margins have been a key source of investor concern in recent

years, amid fears that Big Tech rivals such as Apple Pay and

Google Pay are chipping away at PayPal's ( PYPL ) market share.

While the company long held a first-mover advantage in

digital payments, that edge has diminished, though PayPal ( PYPL ) has

previously pushed back against concerns that its market share is

under pressure.

SPENDING HOLDS UP

Meanwhile, U.S. consumers have continued to spend despite a

mix of economic pressures, including persistent inflation and

the threat of new trade policies, easing concerns about a

potentially sharp pullback in transaction volumes.

Analysts say some shoppers are also buying early to avoid

expected price hikes from tariffs later this year.

That resilience has helped PayPal ( PYPL ) and major U.S. lenders

sidestep early worries that trade tensions could weigh on

spending in the second quarter, even as lower-income households

show signs of strain.

Total payment volume - which tracks the total value of

transactions handled by the platform - increased 6% to $443.5

billion.

Adjusted profit came in at $1.40 per share in the three

months ended June 30. That compares with $1.19 per share a year

earlier.

PayPal's ( PYPL ) second-quarter net revenue climbed 5% to $8.3

billion.