UBS sees Apple selling 78.4M iPhones this holiday, growing sales 4% in fiscal 2016

Analyst Steven Milunovich issued a note to investors on Monday, a copy of which was provided to AppleInsider, in which he gave his outlook on iPhone sales for the near future. He expects yet another record December quarter for Apple, besting the 74.5 million iPhones the company sold in the same period a year ago.

Into calendar 2016, Milunovich has predicted Apple will sell another 61 million iPhones in the March quarter, in what he admitted is a "conservative" forecast.. His estimates call for the iPhone 6s product cycle to post 4 percent unit growth over the iPhone 6.

While some investors have expressed concerns that the iPhone 6s could result in lackluster demand and a year-over-year decrease in units, Milunovich does not share those fears.

While the larger smartphone market flattens out, he believes Apple will "gain significant share" in the coming months from its rivals, even if overall iPhone sales do not continue to grow at the same blockbuster pace seen in years past.

A potential wildcard for 2016 iPhone sales is a rumored refresh of the 4-inch iPhone form factor, which has been rumored to debut in mid-2016. Milunovich said the introduction of a new handset in that form factor could boost overall sales by about 10 million units.

UBS has maintained a "buy" rating for shares of AAPL, though the firm did lower its price target from $150 to $140.