Apple Launches Cheaper iPhone 16e With AI Capabilities

Key Takeaways

• Apple unveiled the iPhone 16e, a lower-cost model with artificial intelligence features.
• The 16e will start at $599, compared to the iPhone 16's $799 price tag, and become available starting Feb. 28.
• CEO Tim Cook previously said Apple Intelligence features helped drive record iPhone upgrades last quarter.

Apple (AAPL) on Wednesday unveiled the iPhone 16e, a lower-cost version of the iPhone 16 that comes equipped with Apple Intelligence tools. 

The “newest member of the family” teased by CEO Tim Cook on X last week will start at $599 and become available on Feb. 28. That’s cheaper than the iPhone 16’s $799 price tag, and the even pricier Pro, Plus, and Pro Max models.

The iPhone 16e will include Apple Intelligence features, which Cook said helped drive record iPhone upgrades in the company’s fiscal first quarter. It’s also powered by the same A18 chip found in the iPhone 16.

Last week, Morgan Stanley analysts said Apple could ship 15 million units of a lower-cost iPhone during the company’s 2025 fiscal year. However, that forecast assumed the new phone would likely be an update to the iPhone SE line, priced slightly lower at $499. 

The 16e announcement also comes after reports that Alibaba (BABA) is partnering with Apple to bring Apple Intelligence to iPhones in China. Apple has reportedly submitted AI features developed with Alibaba to Chinese regulators for approval, a process that could take several months.

Shares of Apple were little changed in intraday trading Wednesday. They've added about a third of their value over the past 12 months.

Do you have a news tip for Investopedia reporters? Please email us at tips@investopedia.com