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7 things we learned from Apple's record-shattering quarterly profit report

On Monday afternoon, Apple released its financial report about its most recent quarter (the three-month period that ended on December 27, 2014). The overall picture was bright — the company reported the largest quarterly profits of any company ever, and its stock went up as a result.

But for ordinary people, it's an interesting window into a company that, as the world's biggest, serves as an important indicator of the entire state of the global economy. Here are seven things we learned from the report:

1) Apple is mostly an iPhone company

(Justin Sullivan/Getty)

In the first quarter of 2014, the iPhone accounted for 56 percent of Apple's revenue. In the first quarter of 2015, that rose to a staggering 69 percent.

At this point, Apple is basically an iPhone company with a few other side businesses.

2) iPhone growth continues to be insane

(Feng Li/Getty)

It sometimes seems like everyone either already has an iPhone, or else is a confirmed Apple hater who's never going to join the sheeple. But in fact, iPhone revenue grew 57 percent year-on-year.

Some of that reflects the introduction of the higher-priced iPhone 6 Plus and other efforts at upselling, but the big story here is a mind-boggling 46 percent increase in the number of iPhones sold.

3) A lot of people live in China

(Feng Li/Getty)

Apple's business in the Western Hemisphere grew "only" about 20 percent this year, with much of that probably happening outside the United States. The real growth engine was "Greater China" (including Hong Kong) where revenue grew 70 percent.

4) India isn't yet iPhone country


Meanwhile, revenue in the "Rest of Asia" (excluding China and Japan) grew at a very respectable 33 percent. But that reflects slower growth from a lower base than the company saw in Greater China.

Far and away the largest component of the "Rest of Asia" is India — where, evidently, people aren't yet buying many iPhones. The country is considerably poorer than China and at this point probably few of its citizens can afford one. A pickup in Indian growth could be very bullish for Apple.

5) The iPad has plateaued

(Justin Sullivan/Getty)

At one point it looked like the iPad might become a second monster business for Apple. Instead, both units shipped and revenue declined somewhat year over year. This is still a very successful product in the scheme of things, but it's no iPhone and it's possible that nothing else ever will be.

6) The Mac has become a remarkable success

(Feng Li/Getty)

Apple scored a 9 percent year-on-year increase in Mac revenue, driven by a 14 percent increase in sales. That's small potatoes compared to the iPhone situation. But in the context of an overall PC market that's shrinking, it's fairly remarkable. As a product category, desktop and laptop computers are in decline. But within the market there's been a marked shift in favor of Apple's machines.

7) Apple is an insane profit machine


Apple earned $18 billion in profits last quarter, about the GDP of Honduras and considerably more than Amazon has earned in its entire lifespan as a company. That's the most money the company has ever made. Indeed, it's the most money any company has ever made in a single quarter, leaving ExxonMobil's $15.9 billion quarter in 2012 in the dust.  This is fueled by gross margins of about 40 percent, a ridiculously high number for a company selling hardware in competitive markets.

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