Apple breaks record for biggest ever company quarterly profit despite drop in iPhone sales

Apple has posted the biggest quarterly profit of all time despite a fall in iPhone sales.

The world's biggest company posted profits of US$20.1 billion ($27.2b) in the crucial final three months of the year, breaking its own record set two years ago, according to the Daily Telegraph.

It came after the release of the iPhone X in November, the biggest update of the handset to date, as well as the release of the iPhone 8 in September.

Although Apple sold 77 million iPhones in the three month period, a 1 per cent fall from last year, the higher price of the new handsets meant revenues from selling iPhones increased.

"iPhone X surpassed our expectations and has been our top selling iPhone every week since it shipped in November," Cook said.

The company's revenues grew 13 per cent to US$88.3b, also a record. The US$20.1b profits were up 12 per cent, from US$17.9b a year earlier.

Sales of the iPad increased marginally, while those of Apple's Mac computers fell. Sales of "other products" - a group that includes the Apple Watch and Apple TV - were up 36 per cent.

Shares initially fell in after-hours trading as Apple disappointed investors with its guidance for the next quarter, but rebounded soon after. The company said it expected revenues of between US$60b and US$62b, below expectations.

"We're thrilled to report the biggest quarter in Apple's history, with broad-based growth that included the highest revenue ever from a new iPhone lineup," Cook said. He added that 1.3billion Apple devices are now in use, up from 1 billion two years ago.

Cook said there had been a record year for the App Store, with augmented reality apps a particular area of growth. Sales of the new Apple Watch Series 3 were double those of the Series 2 last year.

Apple is the world's biggest company and is often tipped to be the first to break the one-trillion-dollar value mark, but shares have wavered in recent weeks amid fears that it may be cutting back iPhone X production.

The new handset, which boasts a bigger screen, no home button, and facial recognition technology, was well received by reviewers. Apple said the decline in iPhone sales was largely due to the quarter being a week shorter than last year.