Apple service growth offsets iPhone sales drop, profit tops Wall Street view

Apple on Tuesday reported surprisingly strong quarterly results, which the company said reflects growth in its services business that offset weakness in iPhone sales.

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The company also used the quarterly report to unveil its new credit card and announce new subscription offerings to TV content and video games.

Apple's services business accounted for 21 percent of its quarterly revenue, which help offset slowing iPhone sales.

“This was our biggest June quarter ever – driven by all-time record revenue from Services, accelerating growth from Wearables, strong performance from iPad and Mac and significant improvement in iPhone trends,” Cook said in a statement.

The Cupertino, California tech giant earned $2.18 per share compared with the $2.10 per share expected by Wall Street. Sales also surged: Apple booked revenue of $53.81 billion compared to the $53.39 billion analysts predicted.

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AAPLAPPLE INC.236.41+1.13+0.48%

“Our year-over-year business performance improved compared to the March quarter and drove strong operating cash flow of $11.6 billion,” Luca Maestri, Apple’s CFO, said in a statement.

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“We returned over $21 billion to shareholders during the quarter, including $17 billion through open market repurchases of almost 88 million Apple shares, and $3.6 billion in dividends and equivalents.”