Apple is set to launch its latest budget iPhone model on Wednesday as it looks to grab a bigger share of the mid-range smartphone market and fend off competition from rivals such Samsung and China's Huawei.

The fourth generation of the lower-cost model, so far known as iPhone SE, will take on popular Android smartphones at a time when consumer electronics makers are looking to add artificial intelligence tools into their devices.

The current-generation of iPhone SE, released in 2022, is available at US$429 (HK$3,346) and the latest version is likely to be priced at a premium to the outgoing model. The iPhone 16, launched in September, starts at US$799 for the base variant.

"If the SE 4 offers meaningful upgrades in design, performance, and AI features, it could reinvigorate its market appeal and strengthen Apple's position across different price segments," Counterpoint Research senior analyst Varun Mishra said.