Apple trade-ins and discounts spark iPhone revival

Apple Inc. executives had a clear message for investors on Tuesday: Demand for iPhones has begun to recover from a bruising holiday period.

The Cupertino, California-based company reported iPhone sales of $31 billion in the fiscal second quarter, slightly better than analysts expected. Apple’s projection for revenue in the current period also topped Wall Street estimates, and could result in the first sales increase in three quarters.

Apple resorted to traditional tactics, such as discounts and generous trade-ins, to revive its iPhone prospects. That dents hardware profit margins, but creates a larger base of device owners to support an expanding roster of digital services. The stock rallied 5 percent in extended trading.