Apple had a whale of a Christmas quarter, thanks to record sales of its latest iPhones, and Wall Street took notice, sending shares jumping 5 percent in after-hours trading after it handily beat analyst expectations.

The company reported earnings of $3.06 a share on revenue of $74.6 billion for the quarter ending Dec. 31, up $13 billion from 2014, despite the serious complications of significant currency exchange “headwinds,” the company’s CFO Luca Maestri said. That far exceeded analysts’ estimates, though the company’s guidance, which historically has been cautious, for the current quarter was slightly below consensus estimates.

Much of the huge quarter could be attributed to what CEO Tim Cook called “staggering demand” for the company’s iPhones. The company set record sales of 74.5 million iPhones in the quarter, well above the range of 67 million to 70 million that most analysts had predicted.

“This volume is hard to comprehend,” Cook said. “On average, we sold 34,000 iPhones every hour throughout the quarter.” As of late December, the company has shipped more than 1 billion devices using its iOS mobile operating system.

The company recently grabbed the top spot in market share in the vast China market, outselling brand-name competitors such as Samsung and no-name knockoffs alike. China sales were up 100 percent year over year, Cook said, even though the latest iPhones didn’t debut until several weeks into the quarter. The company is expanding its retail stores from 10 to 40 by 2016.

Cook told analysts that the company believes that iPhone 6 and 6+ sales will continue strongly.

“You can see from our March guidance that we’re incredibly bullish about iPhone going forward,” Cook said. “We’re doing well in virtually every corner of the world. We’re very bullish that it does have legs. Only a small fraction of the installed base is upgraded (and) we had the highest number of customers new to iPhone last quarter than in any prior launch.”

Gross profit margin jumped to 39.9 percent, up from 37.9 percent a year ago. Forward guidance suggested that would settle back down, to between 38.5 percent and 39.5 percent, Maestri said, with quarterly revenues estimated between $52 billion to $55 billion.

The great iPhone news was balanced slightly by continued declines in iPad sales, down year over year 18 percent in units and 22 percent in revenue. That still meant 21.4 million iPads sold, but the entire tablet sector has been challenged in the past 18 months or so with the rise of larger smartphone sizes that have obviated the need for a tablet, a “cannibalization” of the market that Cook said is likely indeed happening. Even Apple had been forced to begin offering larger phones with its iPhone 6 and iPhone 6+ that debuted last fall.

“I’m still very bullish on the iPad in the long run,” Cook said. When you see it in these developing markets, the number of people buying it for the first time is very high. When you have that kind of first-time buyer rate, the opportunity is very high. When I back up and look at all of these numbers, I believe over the long arc of time, these are very positive.”

On the computer side, Apple said Mac sales were up 14 percent, to 5.52 million units, a quarterly record, Cook said.

The services sector – which includes software and sales of music, movies, TV shows and apps – also was up in a big way, growing 9 percent year over year to $4.8 billion. The company’s App Store set a quarterly record, up 41 percent, Cook said.

AppleTV had a “solid quarter with the existing product,” Cook said of the streaming device that has sold 25 million units so far. “It’s something we continue to look at and work on to see if we can make a bigger impact with what we’re doing.”

There was no talk of the company’s summer acquisition, Beats Electronics and its Beats Music service, which the company bought for $3 billion.

Cook said during analyst questions that the iWatch, announced with great fanfare in the fall, remains on target for debut, but not until April, two months later than initially projected.

“To us, it’s sort of within the range” of when the company expected to roll out the iWatch, Cook said. “Most importantly, we’re going to be thrilled to be shipping it, because a lot of customers want to get one.”

Shares had dropped nearly $4 during the day, closing at $109.14 as traders hedged against possible bad news, but quickly recovered after hours once news of the quarter’s actuals was released.

The company now has a cash horde of $178 billion. It has returned $103 billion of a planned $130 billion to shareholders through dividends, share buybacks and other measures.