Apple reported another strong quarter of profits on Tuesday, as consumers kept buying iPhones and paying more for them, news that could soon help make the Silicon Valley giant the first public company to be worth more than $1 trillion.
Apple said its profit increased to $11.52 billion in its most recent quarter, up nearly a third from the same period a year earlier, showing that the company’s enormous business selling iPhones and other gadgets continues to breeze along.
The strong results beat Wall Street estimates and sent shares up nearly 4 percent in after-hours trading, for a market value of more than $950 billion.
Apple’s ascent past $1 trillion in market value would further confirm a remarkable turnaround from the brink of bankruptcy two decades ago. The steep growth was driven by a series of new products that upended the technology industry — and, in some cases, society — and that remain big sellers.
Apple said it sold 41.3 million iPhones in the latest quarter, up less than 1 percent from a year earlier. But iPhone revenues rose 20 percent because Apple is getting customers to pay nearly 20 percent more for the devices on average, a trend driven by its flagship $1,000 iPhone X.
“That’s a sign that the iPhone X, despite its high price, is resonating with consumers,” said Toni Sacconaghi, an analyst with Bernstein Research.
Apple is also offsetting some slowing growth of its hardware sales with an accelerating business charging customers for apps, data storage and other services. Revenue from those services grew 31 percent to $9.55 billion in the quarter, and Apple Music surpassed Spotify in the quarter as the most popular music-streaming service in North America, Apple’s chief executive, Timothy D. Cook, suggested on the company’s earnings call.
Total revenues in the quarter were $53.27 billion, up 17 percent from a year earlier.
With the huge profits, Apple is sitting on $243.7 billion in cash, much of which it plans to return to investors. In April, it unveiled plans to buy back $100 billion in stock. On Tuesday, the company said it had returned $25 billion to shareholders in the quarter, including $20 billion in share repurchases.
Buying back so much stock helps keep its price high, rewarding investors. “They have so much cash and so much buying power, they can synthetically support the stock. So it’s very hard to bet against,” said Sander Read, chief executive of Lyons Wealth Management. His firm, an investment adviser near Orlando, Fla., has invested roughly $30 million of the $200 million it manages in Apple stock.
Apple’s outlook does have challenges. Arguably no American company has a greater reliance on China for its success, and the growing trade war between the United States and China could threaten its high-flying business.
Apple makes most of its products in China, which is also its third-largest sales market. Mr. Cook said Apple was evaluating a new round of proposed American tariffs on Chinese goods that could hit some Apple products, like the Apple Watch, “and we will be sharing our views of it with the administration.”
Some Apple executive are also concerned that the tariffs could prompt Chinese officials to hamstring Apple’s business in China as retaliation, The The New York Times reported in June. “I can’t predict the future, but I am optimistic that the countries will get through this,” Mr. Cook said.
Apple said Tuesday that its revenue in mainland China, Hong Kong and Taiwan had increased 19 percent to $9.55 billion, nearly the same rate of growth for its sales in the United States.