CUPERTINO, Calif. — Apple has entered the foldable-smartphone market with the iPhone Duo, a long-rumored device that moves the company into a new product category and caps one of its most consequential launches in recent years.

New Chief Executive John Ternus introduced the foldable Wednesday through a video presentation at a packed Steve Jobs Theater. The device has a 7.6-inch display when opened and a 5.4-inch outer display when closed. It supports Apple Pencil and can be used in several positions, including half-folded on a table.

The announcement came nearly 20 years after Steve Jobs introduced the original iPhone, reshaping the consumer-hardware industry and helping propel Apple to unprecedented heights. When open, the iPhone Duo is 50% larger than the iPhone 18 Pro Max, which Apple also unveiled Wednesday.

The iPhone Duo will cost $1,999 for the 256-gigabyte version and will be available Oct. 23. Apple will also sell a two-terabyte version for $3,199.

“We obsess over the details,” Ternus said from the stage before Apple’s video presentation began, as executives and Apple Board Chairman Tim Cook watched. “We care enormously about design simplicity. We want our products to be incredibly powerful, but we also want them to be simple and natural and intuitive.”

When open, the iPhone Duo is the thinnest iPhone Apple has made. The company has also added software designed to support use while the phone is half-folded. The device can serve as a display for calendars or clocks, in a setup somewhat similar to the way consumers use Amazon’s Echo Show products. Its front-facing FaceTime camera is hidden within the screen when the device is open.

The design has some tradeoffs. The Duo feels noticeably heavier than Apple’s other phones when picked up, and reaching every key on the keyboard can be difficult when the device is open and held horizontally.

The launch was Ternus’ first major event since he replaced Cook as CEO earlier this month. The iPhone 18 Pro starts at $1,199, while the iPhone 18 Pro Max starts at $1,299. Both models are $100 more expensive than their predecessors, a change likely related to the industrywide increase in memory costs.

Apple shares, which had been down roughly 1.5% earlier Wednesday, returned to positive territory after the Duo was announced. The stock was up less than 1% in after-hours trading.

The foldable gives Apple a new form factor after years of iterating on the original iPhone design. It also gives the company a new way to compete in a market established by Samsung and provides Ternus with a prominent product as he begins his tenure.

“This is the first time since AirPods came out that this is a product that people really want,” Apple investor Gene Munster told Fortune. “I left feeling like they got a little bit of their product mojo back.”

Apple also said the next version of iOS will arrive Sept. 14 and include its new Siri AI. The software is intended to better understand data across apps, answer questions based on what is displayed on users’ screens, and act autonomously within apps. Some analysts who have tested the update have praised it, while others have described the changes as incremental. Apple has also bet that much of its AI processing can take place locally on devices rather than in the cloud.

Apple’s recent events have “been a wash, rinse, and repeat cycle,” said Michael Gartenberg, an analyst and former Apple marketing employee. Wednesday’s event, however, “was a good event for Apple and a good start for the new CEO,” he said. “While the new Pro devices are mostly incremental, the iPhone Duo takes Apple into new territory. Despite being late to market compared to Samsung and Google, Apple has delivered a solid first generation of foldables.”

Gartenberg said the product’s prospects will depend in part on whether carriers offer significant subsidies and how many users are willing to pay more than $2,000. Although the price is likely to limit the number of potential buyers, it is comparable with competing products, including Samsung’s Galaxy Z Fold8, which starts at $1,899.99, and the upgraded Galaxy Z Fold8 Ultra, which starts at $2,099.99.

Apple is not abandoning the traditional bar-shaped iPhone. The company’s base iPhone 18 is not expected until spring 2027, according to a note from Bank of America analysts. That would represent a departure from Apple’s usual practice of releasing its base and Pro models together.

“The split launch could support mix and [average selling prices] but creates some risk that price-sensitive consumers defer upgrades until the lower-priced models arrive,” the analysts wrote.

Apple, like other companies, has raised prices amid a shortage of memory chips driven by intense demand for AI-computing resources. Its price increases ranged from 15% to 33% across its Mac, iPad, and home-device product lines in what Cook called a “100-year-flood” event in July. That same month, Apple issued a disappointing revenue forecast for its fiscal fourth quarter because of supply-chain constraints.

Investors are also examining Apple’s progress in AI and the rollout of Siri AI. Ternus took over as CEO on Sept. 1 and told employees that day that he was “so excited about everything we have in store.” He added that he was “just as excited about what lies beyond that, including the incredible products already in the works and the ones we haven’t even imagined yet that we’ll dream up and create together.”

The 51-year-old executive is widely regarded as a low-key product-engineering specialist with an encyclopedic memory of Apple product details. He has played a significant role in developing many of the company’s most successful hardware products, Fortune reported in a profile this month.

Ternus is taking over as Apple seeks to compete in AI after largely ceding the AI-model field to rivals such as Google and OpenAI. Those companies are also pursuing consumer hardware opportunities that could compete with the iPhone maker. OpenAI has not yet released a product but is working with former Apple star designer Jony Ive. Roughly half of Apple’s revenue comes from iPhone sales.

Analysts and former Apple employees interviewed by Fortune have said they hope Ternus’ product-engineering background can restore some of the innovation and design momentum they believe Apple has lost over the years. Experts have also said he is unlikely to make drastic changes immediately, particularly because hardware development cycles typically take several years. Even so, Ternus could make an impact in a different way from the supply-chain-focused Cook.

Originally published by Fortune.