Investing.com – Apple Inc (NASDAQ:) is likely to post weaker sales of its flagship iPhone in December, UBS analysts said in a recent note, citing ongoing concerns about slowing demand and declining market share in top market China.

UBS cut its December iPhone unit/sales estimates to 74 million units and $67.2 million in revenue from 77 million units and $69.7 million in revenue. While the broker sees some resilience in Apple’s services revenue, its lowered forecast for iPhone sales resulted in a negative revision to UBS’s December quarter revenue estimates by 2% to $120.8 billion, lower than estimates $124.9 billion.

UBS also lowered its earnings per share estimate for the December quarter to $2.25 from $2.31, compared with public estimates of $2.36.

The brokerage noted recent data from Counterpoint Research that showed iPhone shipments fell 8% year-on-year to 20.7 million units in November, with China accounting for much of that decline. Global iPhone share also fell to 20.1% in November – the lowest level since November 2019.

The brokerage firm noted that October and November typically account for a majority of Apple’s iPhone sales in the December quarter, with a decline in November a bad sign for the tech giant.

“We now expect December quarter iPhone sales to decline 5% year over year, exceeding both our estimate, the VA consensus and the implied positive growth that the company highlighted in the September quarter earnings report , miss,” UBS analysts said in a note.

Apple has struggled with declining device sales for years, with much of that decline attributed to weakening demand in China. The company is also facing increasing competition from local players such as Huawei and Xiaomi (OTC:).

Apple’s integration of artificial intelligence features into its flagship iPhone 16 models did little to boost sales as the company lagged far behind its rivals in introducing AI features. Due to regulatory hurdles, the technology giant has not yet introduced AI functions in China.

Still, Apple’s services revenue remained robust, helped by strong AppStore sales and demand for its software offerings. This is expected to limit overall declines in earnings.