Apple Ditches Budget Smartphone Segment With iPhone 16E Launch

In a strategic shift, Apple Inc. AAPL has unveiled its latest product, the iPhone 16e, marking its exit from the budget smartphone market.

Bloomberg columnist Mark Gurman in his latest weekly "Power On" has shared that Apple’s new iPhone 16e, priced at $599, is $170 more expensive than its predecessor, the iPhone SE.

This price hike places the iPhone 16e in a different segment, leaving the budget smartphone market to rivals such as Samsung Electronics Co., Alphabet Inc.‘s Google, and Chinese manufacturers.

Despite lacking some features of the regular iPhone 16, the iPhone 16e offers most of the flagship lineup’s features for $200 less.

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The decision to increase the price of its low-end iPhone comes as Apple’s China revenue declined by 11% and total iPhone sales fell about 1% during the holiday quarter.

This suggests that Apple is prioritizing profit margins over higher unit sales.

Apple’s new pricing strategy could potentially impede its customer base expansion in emerging markets like India. However, the company may continue to sell older models in certain markets through carriers without advertising them on its website, a tactic Apple has used in the past.

Along with the iPhone 16e, Apple is also gearing up to launch the M4 MacBook Air and has confirmed that Apple Intelligence is coming to the Vision Pro.

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