Apple on Wednesday announced a cheaper new version of the iPhone 16 called the iPhone 16e, signaling a renewed push into the budget smartphone market for the tech giant. It is also the cheapest iPhone that supports Apple Intelligence and the first iPhone with an Apple-designed cellular modem. The iPhone 16e costs $599 and launches on February 28.
Including Apple Intelligence on a less expensive iPhone may be essential for expanding the use of the company’s AI tools. Apple has faced increased competition from Google and Samsung in recent years, both in the budget smartphone market and in the AI space. Google’s cheaper Pixel A-series of phones have been well received, for example, and both Google and Samsung have prioritized updating Android devices with new AI features over the last year.
The iPhone SE, Apple’s budget iPhone line that debuted in 2016 and was last updated in 2022, is also marked by the launch. Consumer Intelligence Research Partners, a market research company, found that as of December 2024, the iPhone SE was only responsible for 5% of all iPhone sales in the United States.