Apple is scheduled to release the earnings results from its fourth fiscal quarter after closing bell tonight, and the biggest debate is whether the iPhone 6S cycle this year will be even bigger than the iPhone 6 cycle was last year. Analysts are firmly split on this, with some forecasting declines and others expecting another increase.

Apple Inc. (AAPL) Q4 Earnings Preview

What to expect in Apple’s FQ4 earnings report

Many analysts are more focused on the December quarter because tonight’s results only include two days of iPhone 6S sales. Also several firms are deriving conclusions from clues within Apple Inc. (NASDAQ:AAPL)’s supply chain, especially Dialog Semiconductor, which released its latest report a few days early.

In a report dated Oct. 26, Wells Fargo Senior Analyst Maynard Um said he expects revenue of $51.7 billion and earnings of $1.95 per share for the September quarter. That puts him ahead of the consensus estimates at $51 billion and $1.88 per share. Apple guided for sales of between $49 billion and $51 billion, which implies earnings of between $1.72 and $1.90 per share.

Um expects Apple’s gross margin to come in at 39.7%, compared to management’s guidance of between 38.5% and 39.5%. He believes Apple sold 49 million iPhone units.

China a cause of concern for Apple (AAPL)?

Analyst Brian White (now with Drexel Hamilton) is ahead of Um’s sales estimate at $52.4 billion but in line with the consensus estimate for earnings of $1.88 per share. One of the concerns analysts have had about Apple and other major companies with big-time exposure to China is the nation’s macroeconomic problems. Apple Inc. (NASDAQ:AAPL) management has maintained that the company continues to do well there in spite of the problems, and White agrees with this.

He thinks Apple still grew its revenue by more than 100% in Greater China during the September quarter. He also expects Apple to have sold more iPhones than the 50.25 million he’s projecting, which would be a 28% increase.

He’s estimating sales of 5.47 million Macs, 9.7 million iPads, and 4.25 million Apple Watches. He sees the potential for upside to his Mac and Watch unit forecasts and downside for his iPad estimate.

Clues from Apple’s (AAPL) supply chain

White and the other analysts whose reports we reviewed this morning mentioned Apple’s supply chain. White said he found strength during his recent China-Taiwan Tech tour but did not go into detail.

Um, on the other hand, said Apple’s supply chain “does present some worry. He noted that Dialog Semiconductor preannounced third quarter earnings that were lower than expected and guided for a fourth quarter that will be lower than Wall Street’s estimates. This is especially important because Dialog gets most of its revenue from Apple, with more than 80% of total revenue coming from its Mobile Systems segment and more than 90% of that segment’s revenue being tied to the iPhone, iPod and iPad.

Dialog posted revenue of $330 million and earnings of 68 cents per share, compared to the consensus estimates of $345 million in sales and 70 cents per share in earnings. The company guided for between $430 million and $460 million in revenue, compared to Wall Street’s estimate of $475 million.

The Wells Fargo analyst noted that historically, there has been “good directionally correlation” between the semi company’s revenue and Apple’s iPhone revenue. However, he also said that “the magnitude could still suggest units that are in line with expectations.”

December quarter earnings in focus

Um said he’s expecting the iPhone 6S cycle to be weaker than last year’s cycle. He notes that in most cases, S cycles are not as strong as their non-S counterparts, so this year he’s estimating December quarter iPhone units to be at 182,000 per carrier, compared to last year’s 194,000 per carrier. He added that this 13,000 decline is much bigger than the iPhone 5S cycle’s 5,000 year over year decline following the iPhone 5 the year before.

However, he also expects this year’s new carrier and country launches (China was in on launch day with the U.S. this year) to offset this lower number of units per carrier. For the December quarter, he’s behind Wall Street’s estimate of 77 million iPhones, coming in at 74 million, but he sees room for upside because there are six more days of sales, which he said could imply units of closer to 78 million and would imply in 192,000 units per carrier.

White is projecting $80 billion in revenue and earnings of $3.30 per share for the December quarter. He has a Buy rating and $200 per share price target on Apple. Um has an Outperform rating and price target of $125 to $135 per share.

Shares of Apple Inc. (NASDAQ:AAPL) rose as much as 0.92% to $116.34 per share ahead of tonight’s print.