Apple is facing pressure as its smartphone sales decline. Above, a customer inspects the new Apple iPhone 6s as it goes on sale in Sydney on Sept. 25, 2015. WILLIAM WEST/AFP/Getty Images

Apple is between a rock and a hard place. Sales of its previous iPhone models have set a bar so high that its current iPhone 6S isn't expected to outpace past generations — a dubious first in the tech behemoth's history. While it is looking to become less reliant for revenue on phones, with the new Apple Watch and a rumored car in the works, the company may lack another blockbuster in the wings to maintain revenue growth in the short term. And that is stirring fresh worries about Apple, which until now has been one of Wall Street's most consistent earners.

Add to all of the above a black cloud over the Chinese market, Apple’s second-largest sales region, and an eroding market cap, and needless to say CEO Tim Cook has his work cut out if he's to calm investor concerns.

For Cook, it's not for lack of trying. But he's at the helm of Apple at a time when it's in transition from a high-growth company to one that is simply looking to hold the line on revenues while searching for the next big thing. “The question now: Is Apple able to pivot that business?” said Angelo Zino, equities analyst at S&P Capital IQ. “It’s more of a scenario where Tim Cook has to manage the company well and look for opportunities to grow the top line here and there versus looking for the next great invention.”

Though Apple wants to diversify revenues by way of services and products such as Apple Music, Apple TV and the Apple Watch, the iPhone for the foreseeable future is still the main sales and profit driver — by far. In Apple's most recent quarter, iPhone sales came in at about $32 billion, or 63 percent of total revenue.

Apple’s stock (NASDAQ:AAPL) has taken a pummeling while the company tries to calm fears that the iPhone is losing steam. Less than a year ago (Feb. 23) , it traded at a peak of $133, and in that same month its market capitalization topped out at nearly $775 billion, making it the first U.S. public company to break the $700 billion threshold. Since then, well over $200 billion of its market cap has vanished and Apple’s closing price last week dipped below the $100 mark for the first time since October 2014.

That shortfall coincided with plummeting markets in China, where circuit breakers halted trading on exchanges on Monday and Thursday. While the mechanism was intended to avert panic selling, it sent shockwaves through global markets. “What the central bank there is trying to do is engineer a soft landing," said Dan Veru, chief investment officer at Palisades Capital Management.

Reports of cutbacks and sales shortfalls surged through Apple’s supply chain in China and other parts of Asia last week amid murmurs of lower demand for the iPhone 6S and 6S Plus. Foxconn, one of Apple’s largest iPhone assemblers, saw its revenue in December fall by 20 percent. Apple is also expected to cut back parts orders by 30 percent during the first quarter of this year to give vendors time to clear out inventory, according to Japan's Nikkei.

Wall Street analysts have responded in kind, with many revising their 2016 iPhone unit estimates to come in anywhere between 210 million and 218 million units, a 6 to 9 percent drop compared to the 231 million units produced in Apple’s 2015 fiscal year. Those forecasts, if correct, could mark the first year-over-year decline in unit sales for the flagship smartphone.

It’s part of a larger trend in the global smartphone market, which is expected to slow to 9.8 percent growth for a total of 1.43 billion units in 2015, down from 27.6 percent growth in 2014, largely driven by a slowing Chinese economy, according to IDC. This leaves smartphone vendors to fight over existing market share in the country.

Put it all together and in the short term you have the perfect storm. The narrative on Apple has “gone from glass half-full to glass half-empty around China because of what has happened with iPhone 6S demand,” said Daniel Ives, senior analyst at FBR Capital Markets. New products like the Apple Watch have also failed to catch on as quickly as investors initially hoped, and its rumored TV streaming service, not to be confused with the app-centric Apple TV, is nowhere to be found.

“I don’t see any product on the horizon that will ... in the next six months enable them to regain $200 billion in market cap,” said Tim Bajarin, president of Creative Strategies.

That said, Apple is exploring a number of new ways to diversify, including a rumored electric car dubbed “Project Titan.” But that isn’t expected to debut until 2019 at the earliest, according to the Wall Street Journal. Apple has explored other technologies such as augmented reality and artificial intelligence-based facial recognition. "I don't think Apple has finished innovating," Bajarin added.

In the short term, what could help Cook and Apple boost iPhone sales is its upgrade program, which enables customers to effectively lease their smartphone and upgrade on a yearly basis. It’s a program that could especially benefit customers in the second half of 2016, when Apple is expected to launch the “iPhone 7," assuming Apple follows previous years' launch trends.

Not much is known about the handset just yet. But early rumors point to wireless charging, waterproofing and possibly no headphone jack. An increased stock buyback program may also help prop up Apple's share price, Zino suggests.

Despite warnings from several vendors in Apple’s supply chain of lower revenue in the holiday quarter and in the first quarter of 2016, not everyone is quick to take that as a clear sign that iPhone revenue will take a turn for the worse. “If you're going to build a model based on the supply chain, you're going to lose,” said Veru. “Because Apple is just so good at using so many different suppliers and keeping it confidential, you can't really know.”

Investors will know soon enough how Apple performed during the holiday quarter. It’s scheduled to release earnings for the period on Jan. 26 after markets close, followed by a 5 p.m. EST conference call to discuss the results.