Apple is expected to release more details about its smartwatch today and possibly unveil some product refreshes. Nonetheless, Wall Street’s focus remains on iPhone sales, as they are the key to the company’s success. There’s evidence that suggests iPhone sales for the March quarter will be higher than the consensus estimate, potentially driven by demand in China.

Apple Inc. Estimates Upped On Strong iPhone Read

iPhone sales look strong

In a report dated March 6, UBS analysts Steven Milunovich and Peter Christiansen said they’re bumping up their iPhone unit estimate for the current quarter from 55 million to 58 million. They report that their Evidence Lab iPhone Monitor suggests iPhone sales could reach as high as 66 million units, compared to the consensus estimate of 54 million units.

As a result of the higher iPhone sales estimate, they bumped up their revenue estimate for Apple from $56.8 billion to $58.8 billion. They also increased their earnings per share estimate for the March quarter from $2.24 to $2.36 per share.

China demand for the iPhone looks strong

The UBS team sets their estimates based on Google Trend searches for the iPhone. If Apple sells 66 million units during the current quarter, that would be just a 12% decline quarter over quarter. In the last three years, the declines have been 14%, 22% and 5%.

They analysts note that the strength in the last quarter could be pushing iPhone searches too high. However, they also say global searches for Apple’s smartphone increased 21% year over year in January and February. They add that China appears to be the main driver of the potential upside, as searches for the iPhone skyrocketed 115% year over year and 7% quarter over quarter.

In the U.S., Google searches for the iPhone were flat year over year and down by 26% quarter over quarter. The UBS analysts call the 26% sequential decline in the U.S. “reasonable.” Here’s a look at how the Apple Monitor has stacked up to actual sales of the iPhone and consensus estimates over the last several quarters. Graphs are courtesy UBS.

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Apple beat the Monitor last quarter

The analysts also report that in the December quarter, sales of Apple’s iPhone actually exceeded the indications from their Apple Monitor. Sales came in at 74.5 million compared to the Apple Monitor’s predicted 69 million, and that was in spite of supply constraints.

Milunovich and Christiansen also point out that only 13% of the iPhone’s installed base have upgraded to the iPhone 6. Also they report that their recent survey suggested that up to 20% of current Samsung owners are considering making the switch to the iPhone.

The UBS team continues to rate Apple as a Buy with a $150 per share price target. As of this writing, shares of Apple were up by 0.74% at $127.56 per share.