Kraft Foods Inc reported a higher-than-expected 11 percent rise in quarterly profit and raised its full-year forecast as the largest North American food maker benefits from price increases, cost cuts and people eating more meals at home.

The results came after food makers General Mills Inc and Kellogg Co also posted stronger-than-expected results and raised full-year forecasts in recent weeks.

Those reports had helped to bolster Kraft's shares, which had risen roughly 11 percent since the start of July. In late trading on Tuesday, its shares declined 1.4 percent.

Investors expected Kraft to probably beat expectations this quarter as well, and also raise their outlook, said Edward Jones analyst Matt Arnold of the stock's pullback in late trading.

He said the quarterly results show Kraft is gaining traction from the restructuring program it implemented in recent years.

Kraft, which makes Oreo cookies, Maxwell House coffee and a host of other well-known products, said net income attributable to Kraft Foods rose to $827 million, or 56 cents a share, in the second quarter, from $745 million, or 49 cents a share, a year earlier.

Analysts, on average, forecast earnings of 54 cents per share, according to Reuters Estimates.

In recent years, Kraft has cut production costs while spending more on advertising and product development to help it garner higher prices and fend off competition from lower-priced store brands.

It has also focused its advertising on saving money for consumers, such as showing the difference between the cost of a DiGiorno frozen pizza and a restaurant pizza, or the lower cost of Kool-Aid versus soda.

Chief Executive Officer Irene Rosenfeld said in an interview that consumers are eating more meals at home, helping spur sales of its sliced meats, Kraft Singles cheese slices and boxes of its Kraft Macaroni & Cheese.

As the food maker looks to introduce new products, she said Kraft will continue to focus more heavily on developing value-oriented items that appeal to today's frugal shoppers.

Kraft said net revenue fell 5.9 percent to $10.2 billion, hurt by the impact of the stronger dollar, which lessens the dollar value of sales made overseas. Organic revenue, a measure of sales that excludes currency fluctuations, acquisitions and divestitures, rose 2.9 percent, helped by higher prices.

Its margins increased 1.9 percentage points to 15.1 percent compared with a year earlier, helped by the elimination of less profitable product lines.

Kraft now expects 2009 earnings per share to be at least $1.93, up from an earlier view of $1.88 per share. It still expects 2009 organic net revenue growth of approximately 3 percent.

Its shares fell to $27.93 after closing on the New York Stock Exchange at $28.34.

(Reporting by Nicole Maestri; Editing by Carol Bishopric, Steve Orlofsky, Gary Hill)