A version of this article originally appeared on Fool.com

WASHINGTON, DC — Tim Cook delivered, but just barely.

Over the past couple of months, investors have been worried whether or not Apple (NASDAQ: AAPL.US) would be able to grow iPhone unit sales in the fourth quarter. In October, Cook said iPhones should grow in terms of both units and revenue.

The company just confirmed that it did in fact post an increase, albeit a modest one. Apple sold 74.8 million iPhones during the busy holiday quarter, approximately 300,000 more iPhones than it sold a year ago. That translated into $51.6 billion in iPhone revenue, similarly a hair higher than the $51.2 billion from a year prior.

Apple also sold 16.1 million iPads and 5.3 million Macs. Total revenue was a record $75.9 billion, and gross margin was 40.1%. Net income added up to $18.4 billion, or $3.28 per share. What else did the Mac maker have to say?

Macro and currency uncertainties
Cook started off the call by acknowledging the unprecedented levels of macroeconomic volatility that global markets and economies are currently enduring. Many countries are experiencing slowing growth — particularly those that are driven by commodities — due to falling commodity prices. That’s leading to a wide range of currencies weakening, especially against the U.S. dollar. He cited a handful of extreme figures for various currency declines.

iPhone average selling prices hit a new all-time high of $691. Incredibly, this figure would have been a mind-boggling $49 higher if it weren’t for said pesky foreign exchange impacts. When we’re talking about 74.8 million iPhones, that all adds up to a $3.7 billion hit for the iPhone alone.

China continues to be a strong market for Apple, and Apple enjoyed the highest ever iPhone sales in The Middle Kingdom. However, Cook did acknowledge that Apple is just now starting to see signs of economic “softness,” which it hasn’t really experienced before. Still, “Greater China” revenue jumped to a record $18.4 billion, an increase of 14%. On a constant-currency basis, revenue would have grown 17%.

Speaking of constant-currency results: The foreign exchange environment has gotten so bad that Apple is now introducing non-GAAP results for the first time in recent memory. In constant currency, Apple’s revenue would have been $5 billion greater. Since fiscal Q4 2014, international revenue has taken a 15% hit based solely on exchange rate fluctuations after that revenue is converted to U.S. dollars. The pain is real, and it’s not going away anytime soon.

Cash and capital returns
Apple now has over $215 billion in total cash, although $200 billion of this is located overseas. The company repurchased nearly $7 billion in stock during the quarter, including its sixth accelerated share repurchase program. That’s a fairly low level of repurchase activity, which also explains why earnings accretion was similarly modest (earnings per share rose 7% while revenue rose 2%).

With its domestic cash position dwindling, Apple will continue to tap public debt markets to fund its share repurchase program. Apple now has $55.7 billion in total long-term debt, plus another $7.3 billion in commercial paper outstanding. Investors can continue to expect an annual update on its capital return program around April.

Watch and TV
Apple Watch and Apple TV both enjoyed record quarters. That doesn’t say a whole lot about Apple Watch, since it’s only been on sale for three quarters and this is its first holiday quarter. And detailed information is obfuscated since both are bundled into Apple’s “Other Products” segment, which was up 62% year over year.

The company also took time to highlight services growth, and pointed out that it has now hit a new milestone of 1 billion active devices. That installed base includes all iPhones, iPads, Macs, iPod touches, Apple TVs, and Apple Watches that have used Apple services over the past three months. Apple is trying to remind investors how much recurring revenue it can rely on, both in terms of services as well as ongoing hardware upgrades.

An iPhone decline is coming
This was always bound to happen sooner or later. Since it didn’t happen sooner (December quarter), it will now happen later (March quarter). Guidance for the current quarter left a little to be desired, but only because Apple is facing an incredibly tough year-over-year comparison. Last time around, Apple was so supply constrained on the iPhone that a lot of those sales were pushed into the March 2015 quarter.

This time around, iPhone channel inventory is within its target range, and the foreign exchange environment is getting tougher. Revenue should be $50 billion to $53 billion. At the midpoint, that would represent an 11% decline. Apple has officially graduated into a value play.

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Evan Niu, CFA owns shares of Apple. The Motley Fool UK owns shares of and has recommended Apple. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.