Sales of Apple’s new variant of iPad and latest  iPhone lineup are surprising strong according to supply chain sources who spoke with Katy Huberty of Morgan Stanley . The iPhone 5 and new iPads will trigger a surge in sales for Apple this quarter and next, says  Huberty.

“Key suppliers into iPhone and iPad noted above seasonal March quarter order trends, stronger than expected December quarter revenue, and the potential to further upside before year-end,” Huberty wrote in an investors note.

Huberty believes that the supply constraints, including the new  touchscreen panels found in the iPhone 5, are no longer an issue. Suppliers informed her that yield rates are now between 70 and 80 percent in the December quarter.

China will also pay a key role in demand for the iPhone and iPad, according to the analyst. Distributors believe the iPhone 5 and the iPad Mini will do well in China, pointing to the lower cost of the Mini relative to its big brother.