Technology giant Apple Inc ( AAPL ) continues to have a headwind in the form of smartphone sales in China.

Here's what a leading analyst has to say about the China concerns and what's next for Apple ( AAPL ).

The Apple ( AAPL ) Analyst: Wedbush analyst Daniel Ives has an Outperform rating on Apple ( AAPL ) and a $250 price target.

Related Link: Apple ( AAPL ) Q1 Earnings Beat Estimates As Cupertino Snaps 4-Quarter Revenue Decline Streak; Stock Slides On China Weakness

The Analyst Takeaways: Sentiment from investors and analysts is approaching a horror show when looking at Apple's ( AAPL ) story, Ives said.

"The biggest concern around the Apple ( AAPL ) name is based on negative data points on China smartphone demand that shows very sluggish sales for iPhones in this key region during and leading up to the important Chinese New Year," Ives said.

Apple ( AAPL ) rival Huawei is seeing strong momentum during the "very challenging period" for Apple's ( AAPL ) iPhone demand in the region, Ives added.

China represents around 20% of Apple's ( AAPL ) global iPhone sales.

"Overall flattish iPhone numbers remain the target for the year with the March quarter expected to have some very tough comps from the China region,” Ives added, citing extra discounting on iPhone 15s in the region.

"This is the cherry on top of the sundae of bad news from Cupertino with last week's reports that Apple ( AAPL ) is ditching the EV project with all focus on AI a highly publicized decade-long bad bet that Cook & Co. had to finally rip the band-aid off and move on."

Ives said he remains bullish on Apple ( AAPL ) despite this negative news and challenges for the company, which now include ending EV plans.

The analyst said the bullish stance on Apple ( AAPL ) is based on 2024 iPhone estimates that are "hittable" and 2025 Street estimates that are "conservative."

"Pent up demand around an upgrade cycle could exceed 270 million iPhones heading into iPhone 16."

Ives also highlighted the strong double-digit growth of Apple's ( AAPL ) Services segment and its upcoming App Store enhancements thanks to AI.

"Apple ( AAPL ) has the strongest installed base of any company in the world with 2.2 billion iOS devices and the next phase of monetization is on the horizon."

While it is not a period of "roses and rainbows for Apple ( AAPL )," Ives said the company can get through the next one to two challenging quarters with several catalysts on the other side.

"Over the last decade we have been through many challenging periods in the Apple ( AAPL ) story and we handheld investors through these stormy periods just like today. This is no different and in our view brighter days will be ahead for Apple ( AAPL )."

AAPL Price Action: Apple ( AAPL ) shares are down 2% to $171.19 versus a 52-week trading range of $147.61 to $199.62. Shares of Apple ( AAPL ) are down 9% year-to-date in 2024.

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