Apple Inc. posted a 33 percent jump in profit last quarter, fueled by strong demand for the iPhone and sales growth in China.
The company also increased its capital-return program by $70 billion.
Over the fiscal second quarter, Apple's revenue in greater China grew 71 percent, to $16.8 billion, compared with the same period last year, the company said in its financial earnings report on Monday.
In total, Apple reported a profit for its fiscal second quarter of $13.6 billion, up from $10.2 billion in the period a year ago. Revenue climbed 27 percent, to $58 billion, from $45.6 billion last year, above the $56.1 billion projected by Wall Street, according to a survey of analysts by Thomson Reuters.
"We are thrilled by the continued strength of iPhone, Mac and the App Store, which drove our best March quarter results ever," said Timothy D. Cook, Apple's chief executive, in a statement.
Apple, based in Cupertino, Calif., also said it was seeing a higher rate of people switching to iPhones from Android smartphones.
Apple said it sold 61.2 million iPhones over the quarter, beating analysts' estimates of roughly 60 million phones. That also far exceeded the 43.7 million iPhones that Apple sold in the period a year ago.
Analysts had anticipated that iPhone sales would increase sharply largely because of the company's growing presence in greater China, which includes mainland China, Hong Kong and Taiwan. The Chinese New Year holiday in February probably fueled many new iPhone sales, analysts said.
"The progress we've made in China has been remarkable and we continue to make incredible investments in China," Chief Financial Officer Luca Maestri said in an interview. "The growth rate in China is significantly higher than most parts of the world."
Sales of Apple's iPad continued to decline, however. The company sold 12.6 million iPads, compared with 16.4 million tablets in the period a year ago. Over the last year, Apple's tablet sales have steadily shrunk, partly because people do not upgrade the devices as frequently as they do smartphones. In addition, as smartphone screen sizes increase, some consumers question whether they need a tablet and a phone.
Apple also said it sold 4.6 million Mac computers, up from 4.1 million a year ago.
Apple reported earnings after releasing its Apple Watch, which began arriving in customers' hands on Friday. The company has said customer demand is exceeding initial supply.
"The customer response for the Watch has been great," Maestri said. "We are working very, very hard to catch up from a supply standpoint -- keep in mind this is not only a new product but it's an entirely new category."
It is unlikely that Apple will share sales figures for the Watch soon. In a previous earnings call, Cook said the company would report sales of the Watch in a group with other products, rather than breaking it out into a separate category, to obscure the Watch's performance from competitors.
Apple on Monday also said it increased its capital return program by 50 percent, using a total of $200 billion in cash by the end of March 2017. The sum will be used to increase share repurchases and lift Apple's dividend, among other moves.
Information for this article was contributed by Brian X. Chen of The New York Times and Tim Higgins of Bloomberg News.
Business on 04/28/2015