As earnings season rips into full gear, things are getting interesting. You’d have to be hiding under a rock to not have heard the big news on Apple (AAPL). On Tuesday, the company stepped up to the earnings podium.

The market was anticipating some big numbers, but boy did the company over-deliver, posting the most profitable quarter in corporate history. Not company history—all stock market history, globally.

In fiscal Q1 2015 (calendar Q4), Apple’s sales totaled $74.5 billion, up a whopping 30% from the year-ago quarter and handily exceeding the consensus estimate of $67.5 billion. Adjusted earnings per share were $3.06, jumping 48% from the year-ago quarter and smashing the consensus estimate of $2.60.

That’s $18 billion in net income… about what Facebook, Cisco Systems, and Yahoo made combined over the past year. Not too shabby.

The iPhone, of course, was the main story. The popular handset reeled in $50 billion in quarterly sales. For the record, revenue for just the iPhone exceeded last quarter’s revenue for Microsoft and Google… combined.

iPhone unit sales were 74.5 million, a 46% jump year over year. Analysts on average expected 66.5 million. “This volume was hard to comprehend,” said CEO Tim Cook, “34,000 iPhones sold per hour, 24 hours a day, every day of the quarter.”

Turns out, a nice chunk of those sales came from the booming Chinese market, which is where Apple is focusing with the US market reaching saturation. iPhone sales in China jumped 83% from the year-ago quarter. And Apple is now the number-one smartphone maker in the region, according to Canalys, a research firm.

But there was one troubling statistic that came from the report: the iPhone now accounts for 68% of total quarterly revenues, a new high…

Source: Gigaom

iPhone growth wasn’t the only contributing factor either. iPad sales declined by 11% at the same time.

This growing lack of revenue diversification has some concerned. “A bet on Apple is increasingly a bet on the iPhone,” said Toni Sacconaghi, an analyst for Sanford C. Bernstein & Company. “The good news is, iPhones are great. The bad news is, right now that’s driving over 100 percent of the revenue growth of the company.”

Apple hopes to reverse the trend of all else shrinking behind the iPhone with the release of the Apple Watch, which will start shipping in April. Will it flourish like the iPad of yore? We don’t think so. But this is Apple we’re talking about, so you never know.

Q4 Growth for Big Tech High Across the Board

On Tuesday, Yahoo (YHOO) released financial results. In Q4, the company reported revenue of $1.17 billion and adjusted profit of $0.30 a share. Both the top and bottom line were essentially in line with analyst expectations, but down from the year-ago quarter about 2% and 34% respectively.

It was a lackluster quarter for Yahoo, which continues to struggle to keep up with the likes of Google and Facebook in the race for digital ad dollars. That didn’t matter for the stock, though: management had an ace in the hole.

10 years ago, Yahoo invested $1 billion in Alibaba, a Chinese e-commerce company you might have heard of. Today, that investment is worth $40 billion, accounting for 88% of Yahoo’s market cap.

The sizable Alibaba stake has been the main thing going for Yahoo. But the concern was that management would do something ill-conceived with the asset, like cash out and blow the proceeds on non-accretive acquisitions. But much to the market’s relief, management chose a different route.

On the call, Yahoo outlined a plan to spin off Alibaba into a new company called SpinCo, which will make its market debut in the fourth quarter of 2015 in a tax-free transaction. Yahoo investors will receive shares in the new publicly traded company, and Yahoo will avoid paying billions in corporate taxes had it realized the gain directly. “It’s kind of hard not to view it as an unadulterated positive,” said Mark Mahaney, who follows Yahoo for RBC Capital Markets. Yahoo shares edged 2% higher on the news.

With Alibaba going off the books, attention turns to Yahoo’s turnaround plan, which includes an aggressive move into mobile. The company has made progress on that front. In Q4, mobile revenue jumped 23% to $254 million, representing about 20% of Yahoo’s sales. But thus far, that hasn’t been enough to stem the overall sales decline. The move to Firefox’s default search engine, however, holds big promise despite the browser’s waning share.

On Monday, Microsoft (MSFT) released Q2 2015 results. In the quarter, revenue totaled $26.5 billion, essentially in line with the consensus estimate and up 8% from the year-ago quarter. Adjusted earnings per share came in at $0.71, in line with estimates but down nearly 9% year over year.

Despite revenues and earnings that met estimates, along with news that by the end of 2016, the company intends to repurchase the $31 billion in stock remaining on its $40 billion repurchase program, MSFT’s share price plunged by 9% on Tuesday to $42.67. The culprit: weak guidance. For the upcoming quarter, the company sees sales of $21.0 billion, 12% below consensus estimates of $23.8 billion.

In the wake of the disappointing outlook, Normura and JP Morgan downgraded the stock. Normura expressed concern about negative sales trends for Windows and Office, while JP Morgan worried not only about revenues, but also that Microsoft is “not exercising as much spending discipline as we had anticipated.”

However, some think Tuesday’s dip represents a great buying opportunity. FBR & Co., for instance, rates MSFT as “outperform” with a price target of $53, about 26% above the current price. “We believe (CEO) Nadella’s cloud vision is taking hold, and that Microsoft remains well positioned and laser-focused in strong secular growth areas,” FBR states.

Credit Suisse, meanwhile, rates the stock as “outperform” and assigns it a target price of $55, about 30% above the current share price. CS believes several options exist to unlock shareholder value, including rationalizing the company’s cost structure, divesting noncore businesses, and optimizing the capital structure.

Last Thursday, eBay (EBAY) reported Q4 revenues of $4.92 billion and adjusted earnings per share of $.90, both in line with consensus estimates. Compared to the year-ago quarter, sales were up 8.5% and earning per share was up 11%.

In next-day trading, EBAY spiked 7%, from $53.38 to $57.15, even though Wednesday’s report included guidance for 2015 revenues and earnings that were (at their midpoints) below consensus estimates by 6% and 5% respectively.

Clearly, weakened guidance was of less importance to investors than other news emanating from the company’s conference call, including: plans to cut the workforce by 7%; a standstill agreement reached with activist investor Carl Icahn; the possibility that the enterprise business will be sold or taken public; and the PayPal spinoff, scheduled for the second half of 2015.

Bits & Bytes

On top of the monstrous earnings mentioned earlier, Apple’s been busy trying to update all the old iPhone users too. It just released a new iPhone update that reduces the amount of storage required to install software updates, solving users’ main complaint about iOS 8. And there’s an awful lot of those complaining users, as Apple has now sold 1 billion iOS devices.

Meanwhile, while our tech team at Casey Research tends to view this mobile payments phenomenon as a solution looking for a problem, Apple may prove us wrong. The company is making headway in this space too. Apple Pay is coming to 200,000 vending machines, kiosks, paid parking, and other self-serve locations. And, since its introduction in October 2014, Apple Pay has accounted for two of every three dollars spent through contactless payments on Visa, MasterCard, and American Express. Still, 67% of almost nothing is also almost nothing.

In news from the growing surveillance state, recently released documents obtained by Edward Snowden revealed details of Canada’s Communications Security Establishment’s (CSE) project to track the online traffic of millions of people around the world, including Canadians.

Even if you’re not online, you’re often being tracked and recorded these days. Documents obtained by the ACLU show how a US DEA program to track cars close to the US-Mexican border has been gradually expanded throughout the country and “is regularly used by other law enforcement agencies.”

But while the government and law enforcement have built out an extensive network of physical and online infrastructure to spy on and track the movements of citizens, they’re now up in arms because of a Google app called Waze, which they claim could be used to stalk police officers.

If you’re sick of the unchecked growth of global mass surveillance, the Electronic Frontier Foundation has a plan to end it. The plan might not work, but at least they’re thinking about it.

Of course, if you don’t like your online life tracked by Big Brother, you could get together with a few thousand of your closest friends and create a hidden private network like the kids in Cuba did. They did it because home Internet connections are mostly banned, not because of spying concerns. And it’s not the real Internet, but it’s still pretty cool.

Oculus is now making its own virtual reality movies for the Crescent Bay prototype. There are some interesting challenges to bring an interactive experience to movies, but given the popularity of VR at this year’s Sundance Film Festival, it’s likely something we’re going to see much more of in the future.

As more evidence that VR is finally here to stay, Firefox has entered the realm. The company has added support for virtual reality apps running on the Oculus Rift to an experimental version of its browser.

Could you live for a weekend on nothing but Bitcoin? The volatility of the digital currency can make it difficult. But the list of companies accepting it for payment is growing, and the first regulated US Bitcoin exchange has been approved for launch, which could help it become more stable.

Hewlett-Packard announced on Monday that after the company splits later this year, current CEO Meg Whitman will become CEO of Hewlett-Packard Enterprise, the corporate computing and networking company, and Dion Weisler will head up HP Inc., the printing and PC company.

Twitter is rolling out its group messaging feature and new mobile video camera.

Shake it like a Polaroid picture. For those who want a more nostalgic camera experience, check out the new Prynt case, which turns your smartphone into a Polaroid-like instant camera.

Meanwhile, the much-reported coming IBM layoffs were expected to begin yesterday (Wednesday, January 28).

Sony is set for a round of firings as well. The company plans to cut an additional 1,000 employees in its smartphone business in an effort to bring the segment back into the black.

Drinking and droning don’t mix. In case you hadn’t heard, a small drone crashed on White House grounds this week, which of course caused an immediate lockdown. Well, it turns out the guy who was flying the quadcopter (and is—or I guess probably now was—a government employee) ‘fessed up to it and told authorities that he “had been drinking at an apartment nearby before he lost control of the craft.”

Last, meet Exploding Kittens.