Apple shares rose after the iPhone maker stepped up its stance amid initial signs of a rebound in premium handset sales.
The tech company said that while iPhone sales fell sharply in the second quarter of the fiscal year – by 17% a year earlier – a resurgence of sales in China at the end of the period gave more confidence.
The company reported revenue of $ 31 billion between January and March – a number that is still above Wall St's estimates, while its growth area, for services like Apple Music and the App Store, reached $ 11.45 billion – a increase of 16%.
Total revenue was $ 58 billion, a decline of 5%, reflecting the iPhone's weaker sales.
Services have become a key metric for investors amid a slowdown in iPhone sales last year.
It was fueled by concerns that their top phones are too expensive in a crowded market and the fact that more customers are keeping older models longer.
Apple has introduced price cuts in China in an attempt to help models change – aided by lower local taxes – and has also introduced trade-in programs in its stores in several countries, including the United States and the United Kingdom.
The company said an improvement in the iPhone in March helped make it more optimistic for the third quarter.
It predicts below $ 55 billion in revenue at the top of a new range – surpassing previous average estimates among analysts at $ 3 billion.
Chief executive Tim Cook told the Reuters news agency: "Looking at the results of the iPhone up to the second quarter, the results were stronger on a yearly basis in the last weeks of the quarter.
"We have also seen a similar result in China. These, coupled with continued success with wearables and so on, give us some confidence that things are getting a little better."
Stocks rose more than 5% in after-hours trading after the numbers were released.
Apple, which is currently losing its position as the most valuable company listed on Microsoft, saw its shares fall almost 2% in the regular trading session, as the market was scared weaker performance than expected by the Alphabet, Google's parent in its first fiscal quarter.
Apple has stepped up to tighten its offer to make it less dependent on iPhone sales.
Last month, it unveiled a new credit card and subscription services for news, television and games.
Only news subscription is available for purchase.
Cook told investors, "Our March quarter results show the continued strength of our installed base of more than 1.4 billion active devices, as we have set an absolute record for Services and the strong momentum in our category of Wearables, Home and Accessories, which set a new quarterly record for March.
"We delivered our greatest iPad growth in six years, and we're as excited as ever about our portfolio of innovative hardware, software and services.
"We look forward to sharing more with developers and customers at the 30th Apple World Conference of Developers in June."