Apple Inc. reported record quarterly sales Tuesday for its iPhone smart-phone models while chief executive Tim Cook briefly sketched a strong quarter and year for Apple Pay, the Cupertino, Calif.-based computer company’s mobile-payments service.


Speaking to analysts in an afternoon earnings call to discuss Apple’s results for the three months ended Dec. 31, Cook said the number of Apple Pay users tripled over the course of 2016 as the service entered new countries. Launched in October 2014, the service is now live in 13 nations, though Apple has historically released few specifics about its performance. The four latest markets are Japan, New Zealand, Russia, and Spain.


Cook said users had performed “hundreds of millions” of transactions during the quarter, with transaction volume ending the year at a 500% increase over the year-end 2015 number. Apple Pay competes with a crowded field of mobile-payments services, including other third-party wallets such as Alphabet Inc.’s Android Pay and Samsung Electronics Co. Ltd.’s Samsung Pay.


Riding the popularity of the new iPhone 7, Apple’s smart-phone sales in the quarter hit $54.4 billion on 78.3 million units, up dramatically from $28.2 million on 45.5 million units in the quarter ended Sept. 30. Both the revenue and unit numbers were up 5% over the year-ago period. Indeed, Cook admitted the company had underestimated demand for the iPhone 7. “Demand exceeded supply throughout the quarter,” he said, with demand-supply balance not being reached until this month. Cook professed optimism for the product’s sales potential, telling an analyst, “I think the smart phone is in the early innings of the game.”


Although the company did not release numbers for its wearable device, the Apple Watch, Cook said the period had been “the best quarter ever” for the product.

Demand around the holidays was “so strong we couldn’t make enough,” he said, calling the device “the gold standard for smart watches.”


Both the iPhone and iWatch allow users to access Apple Pay, and the iPhone is used by many small merchants as a mobile point-of-sale device.


Apple reported quarterly net income of $17.9 billion, down slightly from $18.4 billion a year earlier, on revenue of $78.4 billion, up 3% from $75.9 billion.