Nike sports shoes are still grabbing consumers' attention

Even though profits fell because of higher marketing and business costs, total sales rose by 9% to $4.2bn in the three months to 31 August.

Analysts had been worried that shoppers were becoming more cost conscious and were turning to cheaper Nike rivals.

Nikes shares were seen surging in New York after orders also beat forecasts.

The company's shares added almost 6% in after hours electronic trading in New York, indicating that they will jump when markets open later on Friday.

'Still strong'

Sara Hasan, an analyst at McAdams Wright Ragen, said that observers had been worried that Nike's top products were being seen as less popular and trendy by consumers.

"The Nike brand is still strong at the high end," she said.

Nike said future footwear orders for the quarter to January 2007 were up 6%, above analysts' forecasts of 3% to 5%.

Although Nike boasted of much better sales in China, performance in the UK slowed down.

The UK "is still a very, very tough marketplace", Nike president Charlie Denson said.

Nike's said its profits also suffered because of costs related to stock option expenses.