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Nike Earnings Handily Beat Expectations

Nike Inc. (NKE) Thursday said its second-quarter earnings rose on strong demand for its namesake athletic shoes and Converse sneakers (search).

"It's obviously a very strong quarter, no matter how you look at it," said John Shanley, senior athletic and footwear analyst at Susquehanna Financial Group (search). A wider gross margin and lower costs help beef up the company's earnings per share, he added.

Nike posted a profit of $261.9 million, or 97 cents per share, in the quarter ended Nov. 30, up from $179.1 million, or 66 cents, a year earlier.

Wall Street analysts on average were expecting the company to post earnings of 87 cents per share, according to Reuters Estimates.

Quarterly revenue at the world's biggest athletic shoe company increased 11 percent to $3.1 billion versus $2.8 billion a year earlier.

Beaverton, Ore.-based Nike said worldwide orders for athletic footwear and apparel for delivery between December 2004 and April 2005, a key indicator, rose 9.1 percent to $4.9 billion.

Future orders in the United States rose 10 percent. In Europe, they increased 6 percent, while in Asia Pacific they grew 14 percent, and in the Americas they rose 15 percent, the company said.

"The strength of the (future orders) in Europe was much stronger than we expected and they emphasized that it was not currency-related as it has been in the past," Shanley said.