Apple Inc. (NASDAQ:AAPL) shares slipped 0.2 per cent to $528.30 in after-hours trading, following the company's announcement of its earnings report for the fourth quarter of the fiscal year 2013.

As of real time data stock quote published by NASDAQ OMX (Oct 29, 2013), Apple Inc. (NASDAQ:AAPL) remained "red" sliding 2.5 per cent to $516.65; Wednesday's high at $539.25, Wednesday's low at 514.54; 52 weeks high at $603; 52 weeks low at $385.10.

On Oct 28, Apple had announced revenue of 33.9 million iPhones. According to the company, this is a record for September quarter as compared to 26.9 million in the year-ago quarter. This had exceeded analysts' expectation of just 32 million unit shipments from Apple.

Apple also announced that it sold 14.1 million iPads for this quarter as compared to 14 million in the year-ago quarter.

Apple's Board of Directors had also announced a cash dividend of $3.05 per share of Apple's common stock which is payable by Nov 14, 2013 to shareholders of record as of the close of business on Nov 11, 2013.

With this entirely positive note, why does Apple Inc. (NASDAQ:AAPL) suffered slides after its announcement of fourth quarter's earnings?

Analysts saw that the problem was with Apple Inc. (NASDAQ:AAPL) expected margins for the first quarter of 2014.

Apple had announced its expected gross margins for fiscal 2014 first quarter earnings to come in at gross margin of 36.5 per cent to 37.5 per cent - this fell below the 37.9 per cent expectations from market analysts.

Take note that the first quarter earnings for 2014 is comprised of the holiday shopping period through the end of December, but Apple still lowered its target margin.

Analysts predicted that this lower than expected gross margin announcement from Apple was an outright indication that the company might not be creating new and impressive product lines in the near future - a total letdown for traders and a predicted much lower gross margin in the succeeding quarters.

It does not help that Apple's iPhone and iPad, which were the biggest contributor to the company's revenue, are already suffering cutthroat competition from Samsung and Amazon which provide consumers with more affordable devices running on Google's Android operating system.

As one analyst from NASDAQ OMX put it, "Apple investors have seen margins sliding in the smartphone space for the past few quarters, and that's not great for a company that's made its name on mind-blowing innovation and products it takes its competition literally years to catch up to."

The question remains: can Apple still "innovate" even without the "brains" of Steve Jobs?