Apple revealed its iPhone 16e on Tuesday, a budget-friendly iPhone that includes the company’s Apple Intelligence platform and its first in-house-designed modem.
The iPhone 16e features a design that’s more closely aligned with Apple’s mid-range and high-end iPhones than its previous entry-level phone, the iPhone SE, and comes complete with the company’s Face ID facial recognition technology and an upgraded camera system.
Available Feb. 28 for $599, the iPhone 16e includes the same A18 chip used in the $799 iPhone 16 and $899 iPhone 16 Plus, as well as a single 48-megapixel camera around the back. Apple says the camera will also feature a built-in 2x telephoto zoom for close-up shots.
Apple’s stock was largely flat on the news.
The 16e includes a 6.1-inch OLED display with a cutout at the top to support Face ID that’s reminiscent of the iPhone 14. Apple’s iPhone SE offered a far smaller 4.7-inch screen.
The 16e is also the first iPhone to come outfitted with Apple’s own cellular modem chip, called the C1, rather than one supplied by Qualcomm. The move is part of Apple’s effort to bring more of its supply chain under its own roof, allowing it to control more of its overall design process and cutting down on its reliance on third-party suppliers.
That should also improve overall battery life for the 16e. The device’s battery will provide up to 24 hours of battery life and should offer 12 more hours of power than the second-generation iPhone SE.
The 16e also comes with a USB-C connector rather than the old Lighting port.
As Apple’s entry-level phone, the iPhone 16e is designed to appeal to a broader swath of customers than its mid-range iPhone 16 and higher-end iPhone 16 Pro, which starts at $999.
That price also makes the 16e the perfect platform to put the company’s Apple Intelligence into the hands of ever more consumers. The service, which includes capabilities like writing assistance, notification summaries, and ChatGPT integration is designed to combat competing offerings from the likes of Google and Samsung.
Apple is positioning Apple Intelligence as a major reason for customers to upgrade from their older iPhones at a time when consumers are holding onto their devices for longer stretches of time. But so far it hasn’t been the catalyst Wall Street initially hoped.
During the company’s latest earnings call, CEO Tim Cook told investors that iPhone sales were higher in areas where Apple Intelligence is available. The iPhone is Apple’s most important product, but sales fell short of Wall Street’s expectations in the company’s last quarter.
Analysts were anticipating iPhone revenue of $71 billion during the period. Apple posted sales of $69.1 billion. That was also off from the $69.7 billion in iPhone sales Apple posted in the same quarter last year.
Apple is also dealing with slowing sales in China. Revenue in the region topped out at $18.5 billion in the latest quarter, below expectations and short of the $20.8 billion the company saw during Q1 2024. Full year 2024 revenue out of the region came in at $66.9 billion, down from $72.5 billion.
Apple is facing a multitude of factors in the market including that it’s still working to launch Apple Intelligence in the area at a time when local smartphone makers already have their own AI offerings. According to The Information, Apple has teamed up with Alibaba to bring the software to its Chinese customers, but it’s unclear when it will be available for use.
