July 21 (Reuters) - Verizon raised the lower end of its

annual profit forecast on Monday, as strong demand for its

higher-tier plans powered better-than-expected earnings in the

second quarter.

The U.S. telecom major posted a 2.2% rise in wireless

service revenue as more users opted for its add-ons such as

access to streaming service like Netflix ( NFLX ).

The carrier has launched price-lock promotions and

broadband-wireless bundles to retain users as competition

intensifies from AT&T ( T ) and T-Mobile, as well as

aggressive offers from broadband providers Comcast ( CMCSA ) and

Charter.

However, Verizon posted a surprise drop of 9,000 monthly

bill-paying wireless subscribers in the April-June period,

reeling from user churn after price hikes in January. Analysts

polled by FactSet were expecting an increase of 13,000

subscribers.

To drive growth in the mature U.S. telecom market, Verizon

and its wireless rivals have been bulking up on fiber-optic

assets that can tap growing data use by customers.

Verizon in May won approval from the U.S. telecom regulator

for its $20 billion acquisition of fiber-optic internet provider

Frontier, after it agreed to end its diversity programs.

The sharper focus on internet services helped it posted

293,000 broadband net additions in the second quarter.

Overall, Verizon reported revenue of $34.5 billion, beating

estimates of $33.74 billion, according to data compiled by LSEG.

Its quarterly adjusted earnings per share of $1.22 also beat

estimates.

The company now expects 2025 adjusted profit to grow between

1% and 3%, compared with 0% to 3% previously. It also raised its

annual free cash flow forecast to between $19.5 billion and

$20.5 billion, from $17.5 billion to $18.5 billion.

(Reporting by Harshita Mary Varghese in Bengaluru; Editing by

Arun Koyyur)