Apple's iPhone shipments may flatline this quarter — but the price per phone is going way up, analyst says

Tim Cook, CEO of Apple introduces the new iPhone 7
Mark Neuling | CNBC

CEO promised last year that would , but some analysts already expect the company to report flat or even declining sales of its flagship product on Tuesday.

That includes Cowen analyst Timothy Arcuri, who expects that Apple sold 50.5 million iPhone units in the quarter ending in March, down from 51.2 million units a year earlier.

Analysts surveyed by FactSet expect iPhone shipments to edge higher to 52 million. But Arcuri joins analysts from IDC who predict the sales were "essentially flat." JPMorgan and UBS analysts have also about Tuesday's report.

But, Arcuri writes, that doesn't mean that Apple doesn't have a solid revenue stream in the books. Arcuri said the average iPhone selling price jumped to $688 during the quarter, up from $642 a year earlier. That's thanks to selling more of its iPhone 7 and 7 Plus models.

Analysts surveyed by FactSet expect iPhone unit prices to hit an average of just $658, well below Arcuri's prediction.

Arcuri expects that Apple sold 24 million iPhone 7s, and 17 million iPhone7 Pluses — double the level of new premium phones that were sold this time last year.

The higher price mix has been a trend for Apple. , Cook said there was unexpectedly strong demand for the more expensive iPhone 7 Plus. Indeed, noted KGI Apple analyst Ming-Chi Kuo reportedly expects prices to continue to climb this year as Apple considers more expensive features for the next iPhone, like flexible screens and new 3-D sensors.

Still, Arcuri said that those features could also delay the production of the next iPhone by four to six weeks.

"Ultimately there will of course be zero about the forthcoming launch which is what matters for the stock, " Arcuri wrote in a note on Monday.