UPDATE 2-First Solar profit beats, raises forecast

* Q2 EPS $1.84 vs Wall St. $1.61

* Revenue up 12 percent to $588 million

* Raises full-year profit outlook to $7.00-$7.40/shr

* Shares firm in post market trade

(Adds costs details, forecast, share price)

NEW YORK, July 29 (Reuters) - First Solar FSLR.O reported higher-than-expected, second-quarter profits and raised its full-year earnings forecast, lifting its shares in post-market trading.

Net income fell to $159 million, or $1.84 per share, from $180.6 million, or $2.11 per share, a year ago.

Revenue at First Solar, the leading manufacturer of modules and the industry’s lowest-cost producer, rose 12 percent to $588 million.

Analysts had expected earnings of $1.61 per share, on revenue of $545.4 million, according to Thomson Reuters I/B/E/S.

The decline in earnings from a year ago was largely due to lower selling prices for its modules, the company said, as well as weakness in the euro versus the U.S. dollar.

Most of First Solar’s sales are in Germany, the world’s biggest buyer of the renewable energy systems.

First Solar continued to slash its production costs, cutting 5 cents from its per watt cost to reach an industry leading 76 cents per watt. Unlike most photovoltaic solar companies that use polysilicon in their solar modules, First Solar uses cadmium telluride.

The company raised its full-year, profit forecast for the second time in three months, saying it now expects earnings per shrae between $7.00 to $7.40 per share, up from $6.80 to $7.30 it had previously expected.

Analysts have forecast earnings of $7.12 per share for the year.

First Solar said its sales for 2010 would be between $2.5 billion to $2.6 billion, slightly below the analysts’ average forecast of $2.62 billion.

Shares in First Solar rose about 1 percent in post market trade to $136.72 (Reporting by Matt Daily and Adveith Nair; editing by Carol Bishopric, Leslie Gevirtz)