Baxter International Inc, which makes blood therapy and kidney dialysis products, reported higher-than-expected quarterly net earnings on Thursday, as improved margins helped outweigh the negative impact of foreign exchange rates.

The company also raised its profit outlook for the full year.

In the second-quarter, net earnings rose to $587 million, or 96 cents per share, from $544 million, or 85 cents per share, a year earlier.

The average forecast on Wall Street was for a profit of 94 cents per share, according to Reuters Estimates.

Sales fell 2 percent to $3.12 billion from $3.19 billion, but would have risen 8 percent if not for the stronger dollar, which reduces the value of revenue from overseas.

Revenue in Baxter's Bioscience business rose 2 percent to $1.4 billion. Excluding foreign exchange, revenue was up 13 percent, buoyed by growth in antibody therapies and other specialty plasma therapeutics.

Revenue fell 3 percent to $1.1 billion in Medication Delivery and dropped 8 percent to $550 million in Renal.

Here's another quarter where things are just clicking along, said Edward Jones analyst Aaron Vaughn, who has a buy rating on the stock. Bioscience was again the higher growth area, and they continue to have good growth prospects.

They don't seem to have been impacted by macro economy, and we're looking more of the same.

Baxter said it now expected full-year earnings of $3.76 to $3.80 per share, excluding items. In April, it had forecast $3.72 to $3.78.

For the third quarter, the company said it expected profit of 95 cents to 97 cents a share, before items.

Based on current foreign exchange rates, the company said it expected sales growth to be flat in the third quarter and for the year.

Shares of Baxter closed at $53.09 on the New York Stock Exchange on Wednesday.

(Reporting by Debra Sherman; Editing by Lisa Von Ahn)