Apple profit jumps but shares slip

The US tech giants reported Tuesday that its profit jumped 38 percent to $10.7 billion on surging iPhone sales, compared to $7.7 billion in the same period last year.

Nevertheless, Apple shares fell sharply in after hours trading, at one point down around eight percent as traders noticed lower than expected sales forecasts.

"We had an amazing quarter," chief executive Tim Cook insisted, noting that iPhone revenue in the quarter that ended on June 27 was up 59 percent from the same period a year earlier.

Analysts had expected Apple to sell even more iPhones and were looking for a brighter forecast than was given for the current quarter.

Apple shares dropped more than six percent to $122.41 in after-market trades that followed release of the earnings figures.

Sales of iPhones have been powering Apple profits, and any hint of a plateau spooks investors.

Apple sold 47.5 million iPhones in the quarter, with sales up 85 percent in Greater China where the company's overall revenue more that doubled to $13 billion, accord to chief financial officer Luca Maestri.

Big gains in China came despite stock market woes there.

"We remain extremely bullish on China and we are continuing to invest," Cook said, remaining confident that China is poised to be Apple's biggest market at some point in the future.

"We would be foolish to change our plans. I think China is a fantastic geography with an incredible, unprecedented level of opportunity."

He brushed aside any worry about iPhone sales growth, expressing confidents it has 'lots of legs' that it will be running with for many years to come given market factors such customer satisfaction rates and the booming overall global smartphone market.

"It is an incredible market," Cook said.

"I think everyone is going to own a smartphone, and we can compete for a fair number of them."

Apple did not detail specifics on sales of its newly-launched smartwatch, instead folding the figure into an "other" category that rose 49 percent to $2.64 billion

Cook said during an earnings call that sales of iPhone, iPad, Apple Watch and Macintosh computers "topped internal expectations."

Nearly three months after the launch of Apple's fashionably smart wrist wear, some analysts say it's not a mainstream hit.

But others see promise in its popularity with Internet-savvy younger people.

A recent study by research firm Slice Intelligence suggested that, based on a large sampling of email receipts in the United States, orders for Apple Watch have plunged since the week that the wearable computing gadget made its debut.

The estimate did not factor in data about Apple Watch sales at real-world stores.

However, Cantor Fitzgerald experts believe Apple Watch will be a "go-to gift" during the year-end holiday season and become the best selling new product in Apple's history.

Apple Watch was the first new product line introduced by the culture-changing company behind iPhone, iPad, iPod, and Macintosh computers since 2010.