From what I know, if you go through Apple Care, they say they will repair a device if they can, if not, they send you a new phone. However, I have sent my watch and my phone in to Apple care and they have sent me new devices. Power of Apple Care.
They will likely choose to repair it. Apple is not near as "extravagant" as they have been in the past on warranties. They do more repairing than replacing now.