Apple remains confident it will sell ten million iPhones in 2008, but remains tight-lipped on its plans to introduce a 3G model of the device.

Apple's chief financial officer Peter Oppenheimer refused to comment on the company's much-rumoured plan to launch a 3G iPhone, which most observers predict will debut in June. Oppenheimer would only admit the company to be "excited" about new products it has on the schedule.

Apple sold more iPhones than it had expected to achieve in the quarter, said Tim Cook, chief operating officer at Apple. Inventories fell during the quarter and stores were short on stock, Cook said.

"Currently iPhone inventories are low in both the stores and the channel" in the US and Europe, Cook said. Cook also admitted Apple recognises that a "significant number" of iPhones are being purchased to be unlocked and sold into countries in which the device hasn't yet been introduced, suggesting strong global demand for the product.

Apple confirmed plans to introduce the iPhone into more countries in Europe and Asia-Pacific later this year.

The company plans to deliver iPhone 2.0 software as a free download in late June, he added.

In related news, music products and services made up 36 per cent of Apple's second quarter earnings, while retail store revenues grew on strength of 33.7 million customer visits to a retail store. Retail saw a 74 per cent revenue hike, contributing $1.45 billion to Apple's results. Stores in Australia, China, and Switzerland are planned in the coming months.

iPod revenue climbed 8 per cent thanks to the international success of the iPod touch, which contributed to a higher average selling price on iPods.