Apple's (NASDAQ:AAPL) latest quarter was shockingly good, considering how huge the company is.

In this Industry Focus: Tech segment, host Dylan Lewis and Fool.com contributor Evan Niu go through some of the most important numbers and explain what they mean for Apple. Find out why there was such a big disconnect between earnings per share and revenue, why average selling price for iPhones rose so much, how Apple is employing the gains it saw from tax reform, why Apple and its shareholders love buybacks so much, and more.

A full transcript follows the video.

This video was recorded on May 4, 2018.

Dylan Lewis: Why don't we walk through what they reported on Tuesday, and some of the headline numbers?

Evan Niu: Sure. Revenue was up 16% to about $61 billion. Net income up 25% to about $13.8 billion. Earnings per share up 30% to $2.73. You can see a disconnect there between net income and earnings per share because Apple is so aggressive on the buybacks, and a lot more of those earnings are accreting to individual shareholders on a per-share basis. We'll talk more about the buyback program later.

iPhone units were up about 3% to around 52 million. iPhone revenue was up 14% to about $38 billion. A lot of that is due to the iPhone X and its $1,000 price tag. Tim Cook did note on the call that this is the first product cycle since 2014, when they introduced the two different sizes, 6 and 6 Plus, back in 2014, this is the first product cycle since then where the most expensive iPhone has also been the most popular. So, we're seeing a lot of uplift in terms of average selling prices. That business continues to perform very well. We're seeing Apple actually reaccelerate on the top line a little bit, which is not an easy thing to do when you're talking about a company of this size.

Lewis: Yeah. You teased this a little bit. The number that stood out to me with this was $100 billion. It looks to me like Apple is going to be buying back some more shares over the next couple of years. That EPS number is probably going to continue to climb.

Niu: Right. Of course, the big thing to thank here is tax reform that was passed last year. Many people have expected that a lot of companies would use these tax savings not necessarily for stimulating the economy -- of course, some of that will be there, too -- but, a lot of companies are really allocating a lot of these tax savings toward share repurchases. Which, as investors, we like a lot.

They repurchased over $23 billion in stock last quarter, all in open market purchases, which is a big sequential spike and all thanks to this tax reform. They're expected to complete their current $210 billion authorization during the June quarter. They've spent about $200 billion or so over the past five or six years, which is kind of a mind-blowing figure in itself. And after that, they'll have about $10 billion left.

So, in the June quarter, they're going to finish that off, and then start on this brand-new program that they announced that you mentioned, the $100 billion, which is another humongous number. They're not pinning that on any specific time frame, they're just saying they're going to be fast and efficient with it. But they didn't really specify exactly when they expect to do that all by.

Lewis: And it's really kind of hard to argue with the success of the buyback program for them. If you look at Apple's stock chart, this is a company that has generally been up and to the right with few exceptions over the past five years or so, so it's not as if management has been buying back shares and then seeing the price fall dramatically, and been bad capital allocators. They very opportunistically bought back shares and done quite a service to shareholders by doing it.

Niu: Right. By all traditional valuation metrics, Apple is super cheap. It's hard to compare it against other companies because they're so large. In terms of their size, they don't have a lot of peers that are bringing this much money in as profitably as they do. But they have been very focused on buybacks. Even on the call, CFO Luca Maestri admitted that, yes, Apple is very "biased" toward the buybacks because it's so cheap and because they still think it's undervalued. So, even though they're also increasing the dividend by 16% or so --which is a nice little boost for income investors -- they're still really heavily focusing on the buyback piece, which is better to drive up earnings per share over time, as you can retire a lot more shares. And they're not just buying these back to offset dilution from ongoing compensation. They've retired so many shares over the past years that investors are really getting a tangible benefit from that.

Dylan Lewis owns shares of Apple. Evan Niu, CFA owns shares of Apple. The Motley Fool owns shares of and recommends Apple. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has a disclosure policy.