Despite selling 33.8 million iPhones in its September quarter, the profit margins slid.The company reported a quarterly profit of $7.5 billion and closed out its fiscal year with a net annual profit of $37 billion, an impressive figure but the first annual decline in earnings in 11 years.

The quarterly profit was down 8.6 per cent from a year earlier, but ahead of most analyst forecasts. It came on revenues of some $37.5 billion in the quarter ending September 28, up four per cent year-on-year.Wall Street had hoped for a stronger qaurterly sales after the company predicted in September that its revenue and margins would come in at the high end of its own forecasts.

The current quarter was expected to be a more telling one for iPads, since Apple last week beefed up the line with a slim iPad Air model and an improved iPad Mini ahead of the prime holiday shopping season.Even last week apple also announced updates in its notebooks and desktop computers along with free software to sweeten the deal.The company is trying its hard to be the best in the segment.