Apple (AAPL) will need to keep iPhone price cuts in place in China to continue clear inventory amid soft demand, UBS said in a note emailed Monday.
With an excess inventory build of 2 million to 3 million iPhone units in China in the December quarter, risk shifts to the March quarter, UBS said.
Analysts polled by Capital IQ estimate fiscal Q1 revenue of $118.3 billion and Q2 sales of $96.2 billion.
UBS is forecasting Q1 revenue of $117.8 billion and expects the company to book roughly $1 billion more in sales than the projection.
UBS has a neutral rating on Apple with a 12-month price target of $190.