Chief Financial Officer at Apple
Thank you, Tim, and good afternoon, everyone. We are pleased to report very strong financial results for the March quarter, during which we set a revenue record of $97.3 billion, up 9% year-over-year. We also set new March quarter records in the Americas, in Europe and in Greater China.
On the product side, revenue was $77.5 billion, up 7% over a year ago and a March quarter record. We grew in each of our product categories, except iPad, which remains significantly supply constrained throughout the quarter. And we set March quarter records for iPhone, Mac and Wearables, Home and Accessories. This level of sales performance, combined with unmatched customer satisfaction and loyalty helped our installed base of active devices reach an all-time high for all major product categories as well as geographic segments.
Our Services set an all-time revenue record of $19.8 billion, up 17% over a year ago, with March quarter records in every geographic segment and services category. Company gross margin was 43.7%, down 10 basis points from last quarter. A seasonal loss of leverage and unfavorable foreign exchange were partially offset by favorable mix.
Products gross margin was 36.4%, down 200 basis points sequentially, mainly driven by seasonal loss of leverage and Fx. Services gross margin was 72.6%, up 20 basis points sequentially due to a different mix. Operating cash flow of $28.2 billion, net income of $25 billion and diluted earnings per share of $1.52 were all March quarter records.
These strong March quarter results capped a record first half of the fiscal year in the midst of a challenging macroeconomic environment. We generated over $220 billion in revenue, growing 10% year-over-year and set all-time records for iPhone Mac, Wearables, Home and Accessories and Services. These record sales results drove strong double-digit growth in operating income and earnings per share.
Let me now get into more detail for each of our revenue categories during the March quarter. iPhone revenue grew 5% year-over-year to a March quarter record of $50.6 billion despite supply constraints. Thanks to our continued strong customer response to our iPhone 13 family and the launch of our new iPhone SE, we set March quarter records in both developed and emerging markets, and the latest survey of US consumers from 451 Research indicates iPhone customer satisfaction of 99% for the iPhone 13 family. As a result of this level of sales performance, combined with unmatched customer loyalty, the iPhone active installed base reached a new all-time high across all geographies.
For Mac, revenue of $10.4 billion was a March quarter record, despite supply constraints, with 15% year-over-year growth, driven by strong demand for our M1-powered MacBook Pro. As Tim mentioned earlier, our continued innovation and investment in Apple Silicon has clearly shown in our Mac results as the last 7 quarters have been the best 7 quarter ever for Mac. Our investment focus on Mac has also helped drive significant activity in our growing installed base. In fact, we had a March quarter record for upgraders, while at the same time, nearly half of the customers purchasing a Mac were new to the product.
IPad revenue was $7.6 billion, down 2% year-over-year due to continued supply constraints. Customer response to our iPad lineup, including our new M1-powered iPad Air, remains very strong, and our installed base of iPads reached a new all-time high during the quarter with over half of the customers purchasing an iPad during the quarter being new to the product.
Wearables, Home and Accessories set a March quarter record of $8.8 billion, up 12% year-over-year. And we set March quarter revenue records in both developed and emerging markets. In particular, our Wearables business has doubled in 3 years and is nearly the size of a Fortune 100 business as we continue to attract many customers who are new to Wearables. For instance, Apple Watch continues to extend its reach with over two-thirds of customers purchasing an Apple Watch during the quarter being new to the product.
Turning to Services. As I mentioned, we reached an all-time revenue record of $19.8 billion, up 17%, with all-time records for the App Store, Music, Cloud Services and Apple Care, and March quarter records for video, advertising and payment services. These impressive results reflect the impact of our continued investment in improving and expanding our services portfolio and the positive momentum that we're seeing on many fronts.
First, our installed base has continued to grow, reaching an all-time high across each geographic segment and major product category. Next, we continue to see increased customer engagement with our services. Our transacting accounts, paid accounts and accounts with paid subscriptions all reached all-time highs during the March quarter in every geographic segment. Also, paid subscriptions continued to show very strong growth. We now have more than 825 million paid subscriptions across the services on our platform, which is up more than 165 million during the last 12 months alone.
And finally, as Tim highlighted before, we continue to improve the breadth and the quality of our current service offerings while launching new services. In the enterprise market, many businesses and government organizations continue to turn to Apple for the latest technologies to deliver innovative services to customers and employees. In March, Alaska Airlines began to replace the conventional airport self-service kiosks with iPad Pros for faster passenger check-in and self bag drop. Also, last month, the Western Australia Police Force completed the world's first commercial deployment of CarPlay across their entire fleet of vehicles to complement the iPhone 13 issued to each officer. This allows officers to access critical information faster on the road and enhance public safety for the community.
We also unveiled the general availability of Apple Business Essentials in the U.S., adding a new subscription services designed to help small businesses manage every aspect of their Apple device life cycle.
Let me now turn to our cash position. As we continue to generate very strong cash flow, we ended the quarter with $193 billion in cash and marketable securities. We repaid $3.8 billion in maturing debt, while increasing commercial paper by $2 billion, leaving us with total debt of $120 billion. As a result, net cash was $73 billion at the end of the quarter. We returned nearly $27 billion to shareholders during the March quarter. This included $3.6 billion in dividends and equivalents and $22.9 billion through open market repurchases of 137 million Apple shares. We also retired an additional 5 million shares in the final settlement of our 18th ASR.
Given the continued confidence we have in our business now and into the future, today our Board has authorized an additional $90 billion for share repurchases as we maintain our goal of getting to net cash neutral over time. We're also raising our dividend by 5% to $0.23 a share, and we continue to plan for annual increases in the dividend going forward.
As we move ahead into the June quarter, I'd like to review our outlook, which includes the types of forward-looking information that Tejas referred to at the beginning of the call. Given the continued uncertainty around the world in the near term, we are not providing revenue guidance, but we are sharing some directional insights based on the assumption that the COVID-related impacts to our business do not worsen from what we are projecting today for the current quarter.
We believe our year-over-year revenue performance during the June quarter will be impacted by a number of factors. Supply constraints caused by COVID-related disruptions and industry-wide silicon shortages are impacting our ability to meet customer demand for our products. We expect these constraints to be in the range of $4 billion to $8 billion, which is substantially larger than what we experienced during the March quarter. The COVID-related disruptions are also having some impact on customer demand in China.
With respect to foreign exchange, we expect it to be a nearly 300 basis point headwind to our year-over-year growth rate. Additionally, we paused all sales in Russia during the March quarter. This will impact our year-over-year growth rate by approximately 150 basis points. Specifically related to Services, we expect to continue to grow double digits, but decelerate from our March quarter performance due to some of the factors I just described.
We expect gross margin to be between 42% and 43%. We expect OpEx to be between $12.7 billion and $12.9 billion. We expect OI&E to be around negative $100 million, excluding any potential impact from the mark-to-market of minority investments, and our tax rate to be around 16%.
Finally, reflecting the dividend increase I mentioned earlier, today our Board of Directors has declared a cash dividend of $0.23 per share of common stock payable on May 12, 2022, to shareholders of record as of May 9, 2022.
With that, let's open the call to questions.