Investing.com -- Apple Inc.'s first foldable iPhone, set to launch in September, is projected to ship more than 10 million units in its first year, according to research firm IDC.

The device will mark Apple's entry into the foldable smartphone segment, which Samsung Electronics Co. introduced seven years ago. IDC forecasts the passport-style phone will carry a $2,500 price tag.

"I expect the passport-style Apple foldable to be widely successful despite the high $2,500 price tag," said Nabila Popal, IDC senior research director. "A very elite set of consumers are being targeted here, who will be lining up to buy the device."

The foldable category, which consists of devices that fold like a book to convert from smartphone to tablet size, has remained a small market segment. IDC projects the category will grow 12.6% this year and 18% next year. Apple is expected to capture 40% of all foldable shipments in 2027, according to IDC.

The broader smartphone market faces a 16.7% decline this year, IDC said, revising its forecast downward. Rising costs for memory chips and other components are limiting production and increasing retail prices.

"The components that make AI possible are the same ones in short supply, and their cost is being passed straight through to the shelf," said IDC's Francisco Jeronimo. "The era of the cheap smartphone has ended."

Foldable devices command premium prices, making them a profitable segment for manufacturers despite representing a small portion of the smartphone market, which exceeds 1 billion units annually.