According to a report by Bloomberg:

Instead of minor upgrades, Apple is planning major innovations this year
The highlight will be a book-style foldable iPhone
This device is expected to completely change how users experience an iPhone
Key expected features:
A 7.8-inch display when unfolded
A 5.5-inch outer screen when folded
Powered by the upcoming A20 Pro chip
A 5500 mAh battery (expected)
Design & experience:
The design will be very different from traditional iPhones
Optimized for video watching, gaming, and multitasking
Expected to feel like a completely new category of device
Camera setup:
A design similar to the iPhone Air (rumored)
Likely to include:
Dual cameras
A microphone
Flash
A sleek all-black camera module, possibly resembling the iPad Pro style

Reports also indicate that Apple is actively working on this foldable device, with a possible launch around September 2026.