Apple earnings: iPhone market share still solid, analyst says

Apple (AAPL) shares dip in Friday's pre-market trading session after reporting a fiscal fourth-quarter earnings beat on Thursday, missing on expectations for its Chinese segment.

Martin Yang, Oppenheimer Senior Analyst of Emerging Technologies & Services, comments on Apple's guidance while the iPhone maker attempts to withstand China's current economic environment.

"As an Apple investor, you should have accepted that [the] iPhone comes and goes in cycles between two to four years, seems a very long time ago, and we have had three years of very strong iPhone product cycles," Yang tells Yahoo Finance.

Click here to watch the full interview on the Yahoo Finance YouTube page or you can watch this full episode of Yahoo Finance Live here.

This post was written by Luke Carberry Mogan.

Video Transcript

BRAD SMITH: All of this considered, we're taking a look at shares of Apple here this morning.

Premarket, down by about 2%.

What are investors not liking?

You said that this was, in some cases, better than expected.

What are investors souring on right now?

MARTIN YANG: Sure.

So when we're looking at December guidance, the company is guiding flat year-over-year versus consensus, which is expected to be up 5% year-over-year.

I think there has to be some math to be done to really break down how many analysts are really factoring that 7% advantage a year ago with one more week of sales.

I think we expect to see the stock trading higher throughout the day, as more investors realize beyond headlines that Apple itself is, in fact, not losing share.

And iPhone, as a product, has remained very solid, even in China in a very tough macro environment.

AKIKO FUJITA: Yeah.

With that said, there is a debate about whether, in fact, these upgrade cycles are continuing to slow, whether they be drawn out more.

You could argue the iPhone 15-- our own tech editor said, if you have the 12 upgrade, but if you've got anything after that, it's just not worth the upgrade anymore.

Is that what investors need to accept, if they haven't already, that the iPhone is about incremental changes moving forward?

MARTIN YANG: I think as an Apple investor, you should have accepted that iPhone comes and goes in cycles.

Between two to four years seems a very long time ago.

And we have had three years of very strong iPhone product cycles.

I think the one thing that's a little different this time is that we're not seeing iPhone declining versus the past down cycles because they benefit from an ASP mixed shift to the higher end models, as well as a very robust emerging market growth.

So comparing to past iPhone cycles, I think the trough of current cycles or the cycle trough we're walking through is going to see, maybe, no growth as opposed to declines.

Whereas, service revenues also complements very well on a down cycle with higher margin revenues coming at Apple or coming to Apple at a much stronger volume than before.