NEW YORK (AP) — Luxury bag maker Coach said Tuesday that strong demand for its luxury handbags during the holidays helped fiscal second-quarter net income rise nearly 15 percent.

Results beat expectations and shares rose nearly 3 percent in premarket trading.

The luxury sector has been a bright spot in U.S. retail as the affluent keep spending while other sectors have been slower to recover from the recession. CEO Lew Frankfort singled out North American results.

"We were especially pleased with our ongoing strength in North America during the holiday season," he said in a statement. A key revenue figure, which excludes newly opened or closed stores, rose 8.8 percent in North America during the October-December quarter.

Coach's international business and its growing men's business also did well during the key holiday selling period.

The New York company said net income rose to $347.5 million, or $1.18 per share, in the three months ended Dec. 31, from $303.4 million, or $1 per share in late 2010. That beat analyst expectations of $1.15 per share, according to FactSet.

Revenue rose 15 percent to $1.45 billion from $1.26 billion. Analysts expected revenue of $1.43 billion.

Direct-to-consumer sales, which include Coach stores, catalog and online business, rose 17 percent to $1.28 billion.

Shares rose $1.76 to $66 in premarket trading.