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KEY POINTS Apple reported quarterly earnings on Thursday that beat expectations, and revenue that also topped estimates.

Apple expects to make $60 billion to $62 billion in the current quarter, below the $65.73 billion that Wall Street was looking for.

iPhone units fell from a year ago, despite expectations of modest growth.

Apple reported quarterly earnings on Thursday that beat expectations, and revenue that also topped estimates, hitting several records within its business. Shares whipsawed before settling up 3 percent after hours as investors digested the good news of an earnings beat and higher average iPhone sales price, mixed with disappointing news around forward guidance. Apple expects to make $60 billion to $62 billion in the current quarter, below the $65.73 billion that Wall Street was looking for. Apple also expects profit margins of 38 percent to 38.5 percent, slimmer than the 38.9 percent expected. In other words, Apple either expects to sell fewer phones than Wall Street thought, or expects to sell phones that are either more expensive to make or have lower prices.

Earnings

Earnings: $3.89 vs. $3.86 per share expected by a Thomson Reuters consensus estimate

Revenue: $88.3 billion $87.28 billion expected by a Thomson Reuters consensus estimate

iPhone unit sales: 77.3 million vs. 80 million unit shipments expected by a FactSet estimate

Fiscal Q2 revenue guidance: $60 billion to $62 billion vs. $65.73 billion expected by a Thomson Reuters consensus estimate

Fiscal Q2 margin guidance: 38 percent to 38.5 percent vs. 38.9 percent expected by a StreetAccount estimate The number of iPhone units sold fell from a year ago, despite expectations of modest growth — this time last year, Apple sold 78 million iPhones. Financial results are up from a year ago, though, thanks to pricier iPhones. Apple's average selling prices held up nicely over the holidays — hitting $796, compared to $755.78 expected. In the year-ago period, Apple reported revenue of $78.35 billion and earnings of $3.36 a share. Executives on a conference call tried to calm investor fears. "We typically don't go into this level of detail but I think it's important this quarter to give you additional color, and maybe the two most important messages are that we believe iPhone revenue will grow double-digits as compared to last year during the March quarter and also and, importantly, that iPhone sell-through growth on a year-over-year basis will be actually accelerating during the March quarter as compared to the December," chief financial officer Luca Maestri said. Apple shareholder Ross Gerber said on Thursday that Apple sold a "perfectly fine" number of phones during the quarter, but earnings were a bit less than he was hoping for. "They're doing a great job executing right now," the Gerber Kawasaki president and CEO told CNBC's "Closing Bell." "Hopefully as we move into this year further they have — I think — a clearer path of what position they are going to take on services. Because it's clear that they're going into video and such. But how is that going to be monetized in any way for Apple? I think that's the big question moving forward."

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