I understand that Apple did not make enough money to make it worth their while to continue the iphone mini line. However, it does seem like there is a profitable business for someone there given how beloved it was/is.
I only traded out my iphone 12 mini just recently for an iphone 16 pro (likely the last apple product I will ever buy but thats another story) and aside from the camera it is basically the same. Just heavier, awkward to hold and slightly worse designed.
No major player wants a smaller screen because it has downstream impacts on the pipeline of addictive material and ad pixels they can stuff into ocular nerves.
Modern phones are sold (even at profit) with the intent that there is more payments/ad revenue coming down the line, for movies, TV, games and web browsing/social media. A big screen makes that experience better for people and advertisers. It's a cynical take, but the entire business model is based on building and promoting addiction.
They have no interest in selling phones for utility purposes only, even though that's largely how they advertise the phones, because advertising a 5 hour plus daily screen time isn't sexy at all.