Magna also raised its quarterly dividend to 30 cents a share from 18 cents, citing better expectations for vehicle production in its key markets.
The company said it had earned $293 million, or $2.59 a share, in the second quarter. That compared with a loss of $205 million, or $1.83 a share, a year earlier, when the auto sector was in turmoil.
Revenue rose 63 percent to $6.05 billion.
Analysts expected the Aurora, Ontario-based company to earn $1.46 a share on revenue of $5.4 billion, according to Thomson Reuters I/B/E/S.
Canaccord Genuity analyst David Tyerman said the results were awesome.
I'm not sure I saw anything particularly negative, he said, and I really do think there are going to be significant increases in forecasts coming out of this.
Magna said it now expected 2010 consolidated sales of $22 billion to $23 billion, based on full-year light vehicle production volumes of about 11.5 million units in North America. That was up from an earlier estimate of $21 billion to $22 billion.
The company said light vehicle production was up 75 percent in North America and 13 percent in Western Europe in the second quarter.
I think all of this has positive implications versus my forecast and, I suspect, most of the folks on the street, and the stock is still pretty cheap, said Tyerman.
Shares of Magna, which released its results before the market opened, ended on Thursday at C$75.73 on the Toronto Stock Exchange.
The stock is up nearly 18 percent since early May, when Magna announced a plan to collapse its dual-share class structure by paying founder Frank Stronach nearly $1 billion to give up his controlling stake.
A majority of subordinate share holders approved the plan late last month, even though some said the payoff to Stronach was unreasonable, fundamentally unfair and set a bad precedent.
There will be a hearing in the Ontario Superior Court next week to decide on whether the company can go ahead with the plan.
(Additional reporting by Sakthi Prasad in Bangalore; Editing by Lisa Von Ahn)