Nissan, which is owned 44 percent by Renault SA, announced after the close on Friday that its operating profit for the July-September quarter rose 12 percent from a year earlier, handily beating the market consensus.
The automaker had been expected to suffer a fall in core profits on weak domestic sales and as demand for the Titan pickup and other high-margin light trucks shrank in its biggest market, the United States, due to heated competition and expensive fuel.
But Nissan's global sales grew 6.6 percent to 941,000 vehicles in the quarter and group revenue jumped by 13 percent.
Nissan's stock soared 12 percent to 1,259 yen as of 0200 GMT, set for its largest one-day rise since Sept 29, 2000 when it gained 15.5 percent. Its rivals also jumped, with Toyota Motor Corp and Honda Motor rising about 4 percent.
The benchmark Nikkei average was up 1.2 percent.
"Nissan's profit figures were better than expected and sales volumes are rising. This has given investors confidence," said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments.
"But there are still worries about the dollar and consumption in the United States."
Nissan's July-September operating profit was 218.71 billion yen ($1.92 billion), beating an average estimate of 183.5 billion yen in a survey of four brokerages by Reuters Estimates.
Nissan joined Honda in reporting improved earnings. Its operating profit jumped 48 percent last quarter on brisk sales of its fuel-efficient CR-V crossover. Toyota Motor Corp, the world's biggest automaker, is due to report on November 7.
Many analysts had said they expected Nissan to fall short of its full-year targets, which call for operating profit to rise 3 percent to 800 billion yen, partly due to the yen's recent resilience against the dollar and soaring commodity prices.
Following the earnings announcement, JP Morgan reiterated its "neutral" rating on the stock but said the risk of Nissan missing its full-year estimates had receded and that this would likely be good for the share price over the near term.
"There are signs that the company is recovering from a host of problems, including product quality and inventories, and results were encouraging," JP Morgan analyst Takaki Nakanishi wrote in a note to clients.
