NEW YORK (CNN/Money) - DaimlerChrysler AG drove to sharply improved second-quarter earnings Thursday due to the continued turnaround at Chrysler, and the German-American automaker raised its profit outlook for the year.

The world's No. 3 automaker in terms of revenue earned 1.2 billion, or $1.2 billion, excluding special items in the period. That equaled about 1.21 a share, or $1.19. The company earned $527 million, or 52 cents a share, excluding special items, a year earlier.

The company previously said it would more than double its 2001 earnings of $1.33 billion by a large amount. Thursday's statement said it now expects substantially more than three times last year's earnings level.

Including special items, net income in the quarter rose 52 percent to $1.1 billion, or $1.08 a share, from $720 million, or 72 cents, a year earlier.

The company said the increased profit came primarily from improved operations at Chrysler Group, its North American unit. The division posted an operating profit of $777 million excluding one-time items, compared with a $146 million loss on that basis a year earlier.

Operating profit at Its Mercedes-Benz passenger car and smart car divisions, excluding special items, rose 2 percent to $833 million, while profit on that basis fell 75 percent at its commercial vehicle division to $32 million.

Overall revenue fell 5 percent to $38.8 from $40.9 billion. While European revenue climbed 10 percent to 12.4 billion, Chrysler revenue fell 10 percent to $16.2 billion from $18.0 billion, despite flat vehicle sales, due to the weakening of the dollar versus the euro in the last year.

Shares of (FDCX) were up about 3 percent in Frankfurt just before the earnings report. U.S. shares closed up $1.70, or 3.8 percent, to $46.70 in New York Wednesday.