Apple posted third-quarter sales of $ 35.3 billion on Tuesday as increased competition hit its revenues and profits.
But investors were cheered by better-than-expected sales of iPhones, and in after-hours company shares were up more than 3 per cent to $ 432, but still a long way off their record high of over $ 700 in September 2012.
The maker of the iPhone and iPad said its profit fell to $ 6.9 billion from $ 8.8 billion a year ago, while its total revenues were only $ 300 million more than the same period in 2012.
The flat financial results came despite the company selling 31.2 million iPhones, a record for the June quarter, compared to 26 million in the year-ago quarter.
But sales of iPads fell for the first time since Apple started selling the tablet computers in 2010, with the company shipping 14.6 million iPads, compared to 17 million in the year-ago quarter.
In a conference call Apple Chief Executive Tim Cook said iPhone sales were boosted by strong adoption among business and Government users, saying that iPhones now account for 65 per cent of US commercial sales.
Sales would have been stronger but for a 4 per cent drop in China, Cook said.
Apple’s stock has suffered as investors fret over the lack of new product categories since the introduction of the iPad in 2010. Apple has been rumoured to be working on a new television system and a smartwatch and while Cook did not reveal details he said that the company had a big fall and 2014 in store.
“We are laser-focused and working hard on some amazing new products that we will introduce in the fall and across 2014,” he said.