Air France-KLM upbeat on pricing as bookings improve

(Adds detail, background)

* Results day after Delta, Virgin deal announced

* Strikes relatively optimistic note on pricing

* Lowers annual cost cut targets

By Victoria Bryan and Cyril Altmeyer

BERLIN, July 28 (Reuters) - Air France-KLM (LSE: 0LN7.L - news) offered more optimism than rivals on pricing for the rest of the year, after good travel demand resulted in better than expected second-quarter profit.

The results come a day after the carrier announced a new transatlantic joint venture with Delta Air Lines (NYSE: DAL - news) and Virgin Atlantic and deals for Delta and China Eastern to enter its share capital.

The Franco-Dutch carrier said on Friday that unit revenues had risen 1.5 percent in the second quarter after falling 0.5 percent in the first quarter.

"We believe we will see slightly positive unit revenues throughout the whole of the second half, but some of our rivals are more cautious," Chief Financial officer Frederic Gagey told journalists.

Booming travel demand has resulted in solid second quarter results so far for traditional and low-cost European airlines, including Lufthansa (Xetra: LHAB.DE - news) , easyJet and Ryanair .

However, they have all sounded a note of caution on ticket prices for late summer bookings, despite seeing improvement in the first part of 2017, as carriers continue to add more seats in a race for customers.

Air France-KLM last year saw demand fall in light of a wave of attacks by Islamist militants in France. Gagey said long-haul forward bookings for July and August were up 1 percent against the same time last year, while for September and October they were up 3 percent.

Air France-KLM reported second-quarter operating profit of 496 million euros ($579.9 million), against a forecast in a Reuters poll for 473 million.

However, it lowered its target for cost cuts for the year, saying it now expected a reduction in unit costs of 1-1.5 percent, against a previous estimate for at least 1.5 percent this year.

Air France-KLM did not give a profit outlook for the year, but analysts currently expect a 2017 operating result of 1.27 billion.

($1 = 0.8553 euros) (Reporting by Victoria Bryan and Cyril Altmeyer; Editing by Sudip Kar-Gupta)