* iPad disappoints, results fail to impress
* Investors focusing on holiday quarter
* Competition fierce over the holidays
(Adds earnings details, analysts' comments, byline)
SAN FRANCISCO, Oct 25 (Reuters) - Apple Inc delivered another quarter of lackluster results and iPad sales fell well short of Wall Street targets, pushing its stock down more than 1 percent.
The world's most valuable technology company, whose share price flirted after hours with sub-$600 levels for the first time since August, delivered results largely in line with expectations. It had missed revenue forecasts a quarter ago.
Apple sold fewer iPads than anticipated as the economy remained weak and consumers waited for the new iPad mini, which will hit store shelves next month.
Analysts say the real test for the company will come during the crucial holiday shopping season, when competition will reach fever-pitch with Apple, Amazon.com Inc, Google Inc and Microsoft Corp all fielding new gadgets.
``Going into earnings we were wondering if the slowing economy will catch up with Wall Street and it has,'' said Channing Smith, co-manager of the Capital Advisors Growth Fund.
``Apple is very well positioned with the iPad and now the iPad mini. It has a great smartphone and we expect the iPhone 5 to sell very well. The outlook is conservative but that's not surprising. Err on the side of caution is a proven formula.''
Apple shipped 26.9 million iPhones, somewhat higher than the 25 million to 26 million that Wall Street analysts had predicted. Sales of the iPad came in at 14 million in the fiscal fourth quarter, well below lowered forecasts for the tablet.
It had just nine selling days of the new iPhone 5 in its fiscal fourth quarter - meaning all eyes are now trained on the current holiday quarter.
Apple ended its fiscal 2012 with a 45 percent increase in revenue to $156.5 billion, while net income was up 61 percent.
For the final fiscal quarter, it posted net income of $8.2 billion or $8.67 a diluted share in the fiscal fourth quarter, versus $6.6 billion or $7.05 a share a year earlier. Its earnings beat analysts' average forecast for $8.75.
Fiscal fourth quarter revenue rose to $35.96 billion, roughly in line with the average analyst estimate of 35.8 billion, according to Thomson Reuters I/B/E/S.
``Despite what you are reading about Europe, we did far better than our competitors,'' Apple Chief Financial Officer Peter Oppenheimer said in an interview.
Apple heads into the quarter after refreshing almost all of its product lines, including introducing an upgraded, fourth-generation full-sized iPad. The December quarter will show how well consumers respond to Apple's latest gamble - the new, smaller iPad mini that will goes on sale Nov. 2.
Sterne Agee's Shaw Wu attributed some of the quarter's weak iPad sales to Apple holding back supply of the third-generation iPad to stores, to clear the shelves ahead of the latest iPad.
``We were happy with the 14 million iPad sales in the quarter. It exceeded our expectations,'' Oppenheimer said. ``But as the summer went on, the rumors were pretty rampant about the iPhone and iPad.''
For the December quarter, Apple forecast revenue of $52 billion, below the average estimate of $55 billion, according to Thomson Reuters I/B/E/S.
Apple ended the quarter with $121.3 billion in cash and securities, of which $83 billion was offshore, Oppenheimer said.
(Reporting by Poornima Gupta; Editing by Richard Chang)