Feb 4 (Reuters) - PayPal PYPL.O forecast full-year profit above estimates on Tuesday, fueled by the digital payments giant's push to revive growth in branded products, improve pricing and sharpen cost-cutting efforts.

Since taking over in late 2023, PayPal CEO Alex Chriss has focused on high-margin products and touted 'profitable growth' as the company's new strategy. PayPal has since revamped its pricing approach and shifted away from chasing revenue acceleration.

The upbeat outlook will likely ease investor worries about increasing competition from big-tech giants and fintech rivals such as Block SQ.N in the digital payments sector.

PayPal has worked to defend its dominant position with new products, including a "one-click" checkout feature called Fastlane, and forged lucrative partnerships with companies such as Global Payments GPN.N and Fiserv FI.N.

Transaction margin dollars, a key measure of the profitability of its core business, increased 7% for the full year.

"The improvements we made to branded checkout, peer-to-peer, and Venmo, plus the progress we made on our price-to-value strategy, are beginning to show up in our results," Chriss said.

PayPal expects full-year adjusted profit to grow between $4.95 and $5.10 per share, surpassing Wall Street views of $4.90 according to estimates compiled by LSEG.

It expects transaction margin dollars to grow between 4% and 5% in 2025.

SPENDING RESILIENT DESPITE CHALLENGES

Stronger margins and profitability in branded checkout products, which includes PayPal's core payment services, headlined 2024 for the payments company after years of uneven results.

Consumer spending has also remained resilient as Americans brush off concerns over high interest rates and shrinking savings, splurging on everything from travel to online shopping.

Analysts and investors are optimistic about the outlook for the payments sector this year, though the recent imposition of tariffs by the U.S. President Donald Trump's administration on China are seen as potentially inflationary.

For the first quarter, PayPal expects to post an adjusted profit in the range $1.15 to $1.17 per share, above expectations of $1.14.

The holiday season also lured shoppers as retailers offered deep discounts on Christmas, Thanksgiving, Black Friday and Cyber Monday.

PayPal's net revenue increased 4% to $8.4 billion in the fourth quarter ended Dec. 31. Total payment volume climbed 7%, mirroring results at traditional card networks - Visa V.N and Mastercard MA.N.

It posted a fourth-quarter adjusted profit of $1.19, topping estimates of $1.12.

PayPal's shares surged nearly 40% in 2024, outperforming broader markets and ending three years of consecutive annual declines.

(Reporting by Manya Saini in Bengaluru; Editing by Krishna Chandra Eluri)

((Manya.Saini@thomsonreuters.com; X: manya__saini;))