The most important things we learned from Apple’s earnings call (AAPL)

As mentioned before, Apple’s services business’ revenue grew by 19% in the first quarter. That was up from the 17% pace in the fourth quarter last year, but well off the pace the business was running at earlier last year.

In addition to the problem with games sales in China, the services business was affected by the strong dollar, which boosted the local currency price for Apple’s services in some markets, and by a slow-down in the growth of sales of AppleCare, the company’s warranty offering, Luca Maestri said. A recent accounting change also made growth in the business appear lower than in the past.

On the flip side, the services business is highly profitable, as the company made clear for the first time in its report. The gross margin for the services business — the difference between the revenue Apple garners from those offerings and its direct costs of providing them — was 63% in the quarter, up from 58% in the year-ago period.

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