STOCKHOLM — Electrolux reported on Friday it swung to a higher-than-expected profit in the second quarter (Q2), but cut its demand outlook for Europe and Asia-Pacific to "negative" as it forecast high inflation would discourage customers from splurging on appliances.

Pervasive competition, particularly from Chinese rivals, cost pressures and financial stress among consumers grappling with high interest rates have made it tough for Electrolux to price products like refrigerators and washing machines at a level where it can deliver profitability.

However, aggressive cost-cutting efforts at the Swedish group, which also owns brands such as AEG and Frigidaire, have slowly begun to pay off, with most of the savings expected to come through in the second half of the year.

The company said its operating profit rose to 419 million crowns ($39.41 million) in the second quarter from a year-earlier loss of 124 million crowns, far ahead of the 94 million crowns expected on average by analysts polled by LSEG.

"In general, inflation has been somewhat more sticky than anticipated, continuing to weigh on discretionary spend," Chief Executive Officer Jonas Samuelson said in a statement.

"This has slightly delayed the anticipated improvement in demand, particularly in Europe," he added.

The company cut its market demand outlook for its Europe and Asia-Pacific business areas to "negative" from "neutral" but kept its neutral outlook for North America.