The good news: Apple services and ‘other products’ see significant growth

For the second fiscal quarter of 2016, Apple’s revenues from services (Apple Care, Apple Pay, iTunes, app stores) was up 20% over last year. And the “other products” category -- including the Apple TV, Apple Watch, Beats products, the iPod and accessories -- were up 30% from the second quarter of 2015.

In a call with analysts and the press, CEO Tim Cook said the purchase value of the company’s services tied to the installed user base was a record $9.9 billion dollars in the March quarter. That’ up 27% over last year and an increase from the 24% growth rate in the December quarter.

He added that the reach of Apple Pay also continues to expand following a successful launch in China in the March quarter and last week's rollout in Singapore. Cook says Apple’s mobile payment service is growing at a “tremendous rate with more than five times the transaction volume of a year ago and one million new users per week.”

The CEO says that there are now more than 10 million contactless ready locations in the countries where Apple Pay has launched. That includes over two and half million locations now accepting Apple Pay in the U.S. Cook says that more expansion is coming soon.

Regarding Apple Music, the streaming music service now has over 13 million paying subscribers, according to Cook. The company’s music revenue has hit an inflection point after many quarters of decline, he added.

In a new report — as noted by VentureBeat — Verto Analytics says that Apple has 124.4 million users in the U.S. who accessed at least one of Apple’s online services (web or apps) at least once last March. That means Apple reaches more than half of all adults.

Apple Watch sales met expectations. Cook said Apple expected seasonality to be similar to iPod, which generated 40% of sell-through in holiday quarter.

According to Chief Financial Office Luca Maestri, Apple’s $6 billion in revenue from services is also thanks to the Apple App Store, which saw 35% revenue growth. He says that’s 90% more revenue than Google Play in the March quarter, based on AppAnnie measurements. What’s more, Maestri also said that the average amount spent by customers at the Apple App Store reached an all-time high.