FRANKFURT (Reuters) - Deutsche Bank DBKGn.DE expects second-quarter net profits will be more than double analysts' forecasts in a rare piece of good news for Germany's largest bank which is cutting costs to try to revive profitability.

FILE PHOTO: The Deutsche Bank headquarters are seen in Frankfurt, Germany October 28, 2015. REUTERS/Kai Pfaffenbach/File Photo

The stronger performance partly reflects higher revenues and a bigger drop in costs than analysts had been forecasting. It is a positive sign for new chief executive Christian Sewing, who took over in April and has embarked on plans to cut more than 7,000 jobs in an overhaul of the bank.

But analysts and investors said it was too early to judge whether Deutsche was on a sustainable path to recovery.

The bank’s unexpected earnings preview on Monday said net profit would be around 400 million euros ($468 million) in the quarter, more than double a consensus forecast of 159 million euros but still below 466 million euros reported a year earlier.

The bank also halted a steep decline in revenue, which it said was around 6.6 billion euros, ahead of expectations of 6.4 billion. That is flat compare with the same quarter in 2017, when revenue fell 10 percent from a year earlier.

“Management believes that these results demonstrate the resilience of the franchise,” Deutsche Bank said ahead of its full earnings report due on July 25.

Deutsche Bank shares were up 7.4 percent at 1100 GMT, paring back earlier gains but still well ahead of a largely flat DAX index .GDAXI. The bank's shares are down 35 percent this year.

The bank, trying to bounce back from three consecutive years of losses, has had a run of negative headlines, including an abrupt management reshuffle, a downgrade by Standard & Poor’s and failing the U.S. Federal Reserve’s stress test.

“It’s a bit of a relief that things are not all that bad, but I’m not sure if it’s premature to call this a change in the downward trend,” said Michael Huenseler, head of credit portfolio management at Assenagon in Munich.

Deutsche’s preliminary report said its key sales and trading revenues were down 15 percent, while revenues at the investment bank benefited from about 100 million euros from an asset sale.

Neil Wilson, chief analyst with brokerage Markets.Com, said the share price rise could be a selling opportunity for some.

“It is perhaps a little churlish to be too negative, but it remains something of a habit that is hard to shake given the last few years,” Wilson wrote in a note to investors.

The bank said it had made progress on plans to reduce staff, with headcount down about 1,700 people to just over 95,400.

Costs are expected to come in at 5.8 billion euros, compared with estimates of 6.0 billion euros, Deutsche said.