CUPERTINO, Calif.,: Apple Inc Chief Executive Tim Cook took the stage at the Steve Jobs Auditorium on the new Apple campus Tuesday for the company's biggest product launch in years, which included a completely redesigned top-of-the-line iPhone.
Cook unveiled two new iPhone 8 models, with a new glass-body design and other improvements on the iconic smartphone.
Apple chief executive Cook told a media event that the new handsets, the iPhone 8 and larger iPhone 8 Plus, represent "a huge step forward" for the California tech giant, which is marking the 10th anniversary of the iPhone.
The Apple executive opened the event, where the company is also expected to roll out two other new phones, with the launch of an upgraded Apple Watch, a higher-definition Apple TV and with a tribute for Jobs, who died in 2011.
As Cook announced the updated version of its smartwatch he claimed the device had become the top-selling watch in the world, ahead of rivals such as Rolex and Fossil.
The Apple Watch Series 3 has its own mobile connectivity which allows the user to remain connected without a smartphone for phone calls, music and other functions.
"The Apple Watch is now the number one watch in the world," Cook said during the launch.
While Apple has not provided detailed sales figures for the watch, Cook said sales were up 50 percent in the past quarter from a year earlier.
Apple said the new smartwatch offers several improvements including cellular connectivity and applications to help detect health problems such as heart arrhythmia.
"You can receive a call with just your watch," Apple's Jeff Williams told the event, where the company was set to announce a new range of iPhones.
The watch with cellular connectivity will be available in nine countries September 22 starting at $399, Apple said.
Analyst Patrick Moorhead of Moor Insights & Strategy, who was attending the event, said the new device was a significant step forward with arrhythmia detection.
"I believe this kind of capability is what wearables were always intended to do, and that is to detect maladies before they impact people," Moor said. "This is a great step in the industry."
"We dedicated this theater to Steve because we loved him and because he loved days like this," Cook said.
The Apple building itself was considered to be Jobs' final product, and Cook spent a few minutes boasting about the design, energy-saving features and public spaces at the new campus, including a flagship Apple Store.
The theater, never before open to the public, features an expansive glass-enclosed lobby, with two massive white stone staircases leading down to the auditorium. Inside, the decor is similar to that of Apple's stores, with hard maple flooring and tan leather seats.
The new products and the holiday shopping season that follows are the most important for Apple in years.
The company has sold more than 1.2 billion iPhones over the past decade and ushered in the era of mobile computing, but last year had a substantial decline in revenue as many consumers rejected the iPhone 7 as being too similar to the iPhone 6.
Apple hopes the new high-end phone, called the iPhone X, will silence critics who say the company has lost its innovation edge.
The phone features an edge-to-edge display with richer colors and facial recognition to unlock the device without a fingerprint reader or physical home button. It can be woken by tapping the screen.
The two other models, called the iPhone 8 and iPhone 8 Plus, update the iPhone 7 and iPhone 7 Plus. They could also include new features, such as a glass back similar to the iPhone 4 that would facilitate wireless charging.
The iPhone 8 starts at $699, and comes in 64GB and 256GB models.
The iPhone 8 Plus starts at $799 and also comes in 64GB and 256GB models.
That compares to a top base price of $769 for the iPhone 7 Plus.
Much of that added cost is driven by more expensive parts, like a higher-resolution display, 3D sensors and more memory capacity.
"Some of these components are just darned expensive. There's just no doubt about that," said Brian Blau, Apple analyst at Gartner.
Blau expects Apple to keep several lower-priced models in its lineup.
Shares of Apple, which had been trading slightly lower before the event kicked off, reversed course and were last up 0.15 percent.
As Analysts expected, Cook announced a 4k Apple TV, a higher resolution than its previous set.
The higher resolution could play into video programming efforts, which have shifted into a higher gear recently with two high-profile executives hired away from Sony Pictures Television.
The company is also expected to reveal more details about the HomePod, its voice-activated home speaker that competes with Amazon.com Inc's Echo devices and the Google Home speaker.
Apple announced the HomePod in June and said it will ship in December.
Apple does not say how many Apple Watches it sells but Gene Munster, an analyst with Loup Ventures, believes sales of the watch could double or even triple because of the new connectivity.
But even a huge boom in one product and topping smart watch rivals include Fitbit Inc and Garmin will not move Apple's financials much, since the iPhone accounted for 63 percent of the company's $215 billion in sales last year.
"It's a really big deal for the wearables category for Apple, but it's not a big deal for the company," Munster said.