After Setting iPhone Record, What Does Apple Do Next?

Apple CEO Tim Cook says consumer demand for new iPhones has been "staggering" and "hard to comprehend." That helped the company report record-smashing earnings for its latest quarter and primed its stock for a rally Wednesday.

But after selling a record 74.5 million iPhones in three months that ended in December, what can Apple do next?

Some analysts worry that Apple depends too much on the iPhone, which contributes two-thirds of its sizable revenue -- leaving the company vulnerable if some other gadget comes along to replace the iPhone in popularity. Cook and Chief Financial Officer Luca Maestri, however, say they're optimistic about other products in Apple's portfolio. Here's some of what they talked about on Tuesday.

Apple Watch

Apple plans to start selling its highly anticipated smartwatch in April, Cook told analysts on a conference call after the company's earnings report Tuesday. He added that developers are working on new apps called "Glances" -- apparently in reference to the way people will view those apps on their wrists.

Cook boasted he's already wearing and enjoying an early model. "I'm using it every day and love it and can't live without it," he said.

Still, some analysts say it's difficult to predict demand for the Apple Watch. "We continue to believe interest from consumers is tepid," said Piper Jaffray's Gene Munster in a recent note to investors.

Apple Pay

Apple introduced its digital payments service last fall, but Cook vowed Tuesday that "2015 will be the year of Apple Pay." He said 750 banks have signed up for the program, which now accounts for two out of every three dollars spent through so-called "contactless" payment systems, as opposed to credit cards that are swiped at the point of sale.

While Apple is believed to collect fees from banks when shoppers use Apple Pay, it doesn't specifically disclose revenue from...

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