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Apple Inc.’s earnings beat market expectations today with its latest quarterly report, and the company Steve Jobs built managed to do so despite weak iPhone sales.

For Apple’s fiscal third quarter, the company reported $53.8 billion in revenue, up 1% over the same quarter last year. Profit fell 7%, to $2.18 per share, which still beat forecasts, according to CNBC.

Apple revenue was led via iPhone sales, at almost $26 billion, followed by Mac sales of $5.8 billion, iPad sales of $5 billion, wearables and other devices at $5.5 billion, and services at $11.5 billion.

The services number, up 13% year-on-year, is notable because it’s the highest amount Apple has ever reported in the category at a time it is focusing on them as a key revenue and growth generator. Apple services include Apple Music and iCloud, the former finding a growing audience, along with Apple TV apps and Apple Pay. Higher numbers are expected in the segment going forward with Apple set to launch its own credit card in August.

By comparison, however, iPhone sales were down from $29.5 billion in the same quarter of last year and $31.1 billion in the last quarter. Sales in “Greater China,” (pictured), as Apple describes mainland China, Hong Kong, Macau and Taiwan, led the iPhone decline. Sales over a nine-month period fell by $8 billion from the same period last year, though in the latest quarter, the sales decline slowed from a year ago, down approximately $400 million.

While services were a standout for Apple, now the company’s second-largest revenue line item after the iPhone, the results in the wearables, home and accessories segment was also strong, up nearly $2 billion from a year ago. The category, previously listed as “others” in Apple’s financials, includes the Apple Watch, AirPods and HomePod. The category has surpassed iPad sales, according to Business Insider, and is currently on track to surpass Mac sales as well.

“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,” Apple Chief Executive Officer Tim Cook said in a statement. “These results are promising across all our geographic segments, and we’re confident about what’s ahead. The balance of calendar 2019 will be an exciting period, with major launches on all of our platforms, new services and several new products.”

Investors were happy with results. Apple shares rose about 4.5% in after-hours trading, at $218.13, the highest share price since November. Update: Shares rose only 2% Wednesday on a market day marred by negative reaction to the interest-rate cut.

“We see the potential for meaningful multiple expansion as new Services re-accelerate growth and Apple approaches the September 2020 launch of 5G iPhones, which have the potential to accelerate upgrades and return iPhone to meaningful Y/Y growth,” Morgan Stanley analyst Katy Huberty wrote in a note to clients.

Photo: Duncan Riley