updated 9/20/2004 10:46:26 AM ET 2004-09-20T14:46:26

Nike Inc. reported a better-than-expected 25 percent increase in first-quarter profits on Monday, helped by its strongest U.S. orders in more than seven years.

For the three months ending Aug. 31, the sneaker and athletic apparel manufacturer earned $1.21 per share, or $326.8 million, compared with 98 cents per share, or $261.2 million, at the same time a year ago. Analysts surveyed by Thomson First Call had predicted $1.11 a share.

In trading Monday morning, Nike shares were up $1.36, or 2 percent, at $77.92 on the New York Stock Exchange.

“It really was an earnings surprise — they beat us by 10 cents. I really can’t remember when the company beat us by that margin in the past,” said Mitch Kummetz, senior equity analyst for D.A. Davidson & Co. in Portland.

He attributed much of the results to an improved relationship with retailer Foot Locker, and a renewed interest in performance footwear because of the Olympics.

First-quarter sales were up 18 percent to $3.56 billion from $3.02 billion a year ago.

Worldwide orders jumped nearly 10 percent, with less than 1 percent of the growth due to changes in currency rates.

Beaverton-based Nike also reported a large increase in its U.S. orders, which rose 12 percent to $1.4 billion — reversing a declining trend in the national shoe market over the last several years.

“We’re off to a great start,” said Philip H. Knight, Nike’s chairman and chief executive, noting that domestic orders are their highest level in more than seven years.

Copyright 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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