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Apple shares were up in late US trading yesterday after the technology company announced an 88 per cent increase in its second-quarter profits.

The California-based firm said that its net profit reached $770 million (£384 million) during the three months ending March 31st, with growing demand for its Macintosh computers and iPod music players fuelling its strong performance.

In addition to improving on the $410 million (£205 million) it posted in the same period last year, Apple's gross margin also improved beyond expectations, up from 29.8 per cent to 35.1 per cent over the year.

Total sales were up $4.3 billion (£2.15 billion) to $5.2 billion (£2.6 billion), with Apple reporting a 36 per cent rise in demand for Macs and a 24 per cent increase in the number of iPods it shipped over the quarter.

More than 10.5 million iPods and 1.52 million Macs were sold during the first three months of the year.

Apple said it also had high hopes for its new iPhone, which will be launched in June.

Welcoming the results, the company's chief financial officer Peter Oppenheimer said: "We are very pleased to report the most profitable March quarter in Apple's history."

He added that Apple expected to report revenue of around $5.1 billion (£2.55 billion) and earnings per diluted share of about $0.66 (£0.33) during the third quarter.

Meanwhile, Apple also acted to defend chief executive Steve Jobs against accusations made by its former chief financial officer in
relation to a row over the apparent backdating of stock options.

Fred Anderson claims he made Mr Jobs and other Apple board members aware of his concerns that stock-option granted to company chiefs in 2001 were not properly dated.

The US securities and exchange commission has announced that Apple will not be sanctioned over the matter although Mr Anderson and the company's former lawyer have been held to account over the inconsistencies in the firm's records.

Rejecting Mr Anderson's implication that Mr Jobs was more involved in the scandal than he has said, six of Apple's board members, including former US vice president Al Gore, issued a statement supporting the company's chief executive.

The board members said that they had "complete confidence" in an independent investigation launched by Apple which cleared Mr Jobs of any wrongdoing and also in his "integrity and his ability" to lead the company.