Nike recorded a 7% increase in net income as the company registered "continued strong demand" for its products.

The footwear manufacturer said yesterday (22 March) that net income reached US$560m over the quarter ended 29 February.

Revenue increased 15% to $5.8bn, and was up 16% on a constant currency basis.

The company attributed the profit gains to continued strong demand for its products combined with SG&A expense leverage and a lower average share count, which it said more than offset the impact of a lower gross margin and higher effective tax rate.

However, gross margin was down 200 basis points to 43.8%, which was due to higher product costs, which the company said more than offset the positive effects of price increases, direct sales, and cost reduction initiatives.

"The environment remains volatile, but I'm optimistic about the future. We're starting a great season of major sports events and we have a pipeline full of innovation to fuel growth over the long term," said president and CEO Mark Parker.

The company said that inventories increased by 32% on the previous year, with 20 percentage points of that due to higher product costs and changes in product mix, and the remaining 12% to higher wholesale unit inventories to support strong demand and as because of more timely deliveries from its suppliers.

It added that, at the end of the quarter, orders scheduled for March through July totalled $9.4bn, 15% higher than orders scheduled for the same period of the previous year.