The world's third-biggest advertising agency narrowed its annual target for organic growth to 3.6 percent from between 3.2 and 3.6 percent.

The pick-up seen at Publicis, which comes after a relatively slow first quarter, may bode well for the results of market leader WPP (>> WPP PLC) and number two Omnicom (>> Omnicom Group Inc.), due in the coming weeks.

Market researchers have predicted global advertising spend will growth 3 to 3.5 percent this year.

"The results are good but it has not been easy and we must remain vigilant since there is a lot of uncertainty in the world economy," said Publicis Chief Executive Maurice Levy.

"Emerging markets are in slight retreat, the U.S. is holding up well, while Europe remains in search of growth."

First-half sales rose 8.7 percent to 3.35 billion euros ($4.39 billion), in-line with analysts' expectations. Revenue was 1.79 billion in the second quarter.

Operating profit rose 11.6 percent to 462 million euros, ahead of the Thomson Reuters I/B/E/S average of 440 million.

The operating margin was 13.8 percent in the half, an improvement from last year's 13.4 percent, helped by continued cost cuts in everything from real estate to technology.

Growth was strong in North America and emerging markets, including Brazil, China, India and Russia, while European sales contracted by 1.1 percent in the second quarter.

Levy said most sectors, including autos, banks, telecoms and technology, and consumer goods, had maintained or boosted marketing budgets in the second quarter.

DIGITAL PAY-OFF

The exception was Publicis' healthcare business, which has shrunk in recent quarters because of big pharma companies' struggles with patent expiries and slow new drug approvals.

Levy said the pharma business would likely return to growth in the third quarter, however.

Across the board, major companies spent more on so-called digital advertising and services than old-fashioned print and television ads, Levy said.

"This is the pay-off from our strategy of growing in digital," he said.

Boosted by a billion euros of acquisitions in the past two year, the agency has expanded into social media services, buying ad space for brands online in real-time auctions, and designing campaigns for the web.

Publicis said it now earns almost 37 percent of sales from such digital activities.

Its larger competitor WPP is also well positioned in the area.

Bernstein Research analyst Claudio Aspesi wrote in June that WPP and Publicis had "significant leadership positions" in both emerging markets and digital, giving them an advantage over U.S. peers Omnicom and Interpublic Group (>> Interpublic Group of Companies Inc).

Publicis shares have risen 28 percent this year to close at 56.57 euros on Wednesday, compared with a 14 percent rise for the Stoxx 600 European Media index <.SXMP>.

($1 = 0.7637 euros)

(Editing by James Regan)

By Leila Abboud