I've never seen that so can it explode??
Anything with Li-Ion battery can explode. It's happened to these batteries on planes, in shipment, devices in pockets, laptops, phones, the list goes on. Does it happen often? No it's quite rare. But it can happen. If one of the internal cells shorts out, is damaged, overcharged, undercharged, it can become an incendiary device.
This is why manufacturers take such care and have built in charging circuits to prevent over and under voltage conditions. However, nothing is perfect. When hundreds of millions of these batteries are produced there will be defective cells. Should you experience any kind of swelling, severe overheating, or exceedingly short life that occurs all of a sudden. Get the device to the manufacturer/store ASAP, as your hand held time bomb is ticking.
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I had to exchange three 5s in the Apple store because the back was popping off on them. The one I kept ended up lasting 1.5 years, but eventually popped off as well. That was when I went for the 6s+ on trade in.
There was obviously a design flaw, kind of surprised that they kept that body for the SE.
NO it is not obviously a design flaw. What is obvious is you know very little about batteries and how devices are put together. When a Li-Ion battery cell internally goes bad, they many times will swell up. This will destroy by expansion any device, phone, laptop, GPS unit, whatever, that is made from multiple components. The chemical reaction in the battery is quite strong. Anything short of a solid steel box with no seams will be expanded.
Actually it's a good thing the phone screen pops of and shows expansion. This is a warning sign that battery cell is defective. It could explode catching fire. Take it in and have it replaced. No one, not even Apple can make millions of batteries and not have a few defective ones that get out in the field. Batteries are a very dynamic device. The chemical reactions going on inside are quite volatile by nature, to provide the hours of power you as consumer desire.