A new range of larger iPhones helped Apple to achieve record profits of $18bn (£11.8bn) in the final three months of 2014, the technology giant has announced.
The company sold 74.5 million smartphones between October and December, buoyed by the launch of the iPhone 6 Plus, which is equipped with a 5.5-inch screen.
Experts had expected total revenues of $53.6bn (£35bn) for the quarter - but according to Apple's CEO, Tim Cook, this was closer to $74.6bn (£49bn).
According to technology analysts, it took Apple a long time to come to grips with the fact that the public wanted larger screens - causing their market share to plummet.
Gartner's Van Baker said: "They finally closed the gap on a feature they were missing, which their competition had capitalised on."
Some investors are concerned about how Apple will perform financially in the coming year, with iPad sales down 22% in the last quarter, and warnings that growth in the smartphone sector is beginning to slow.
The iPhone accounts for two-thirds of Apple's revenue.
Although the California-based firm is planning to launch a smartwatch in March, it remains unclear whether the device will be a big hit with customers.
Other companies have been disappointed with demand for similar offerings, amid concerns that the battery life is insufficient for a whole day's use.
Apple is currently the world's most valuable company, with a market capitalisation of $651bn (£428bn).