If you add up the sales for iPhone 12m, iPhone 13m and iPhone SE 2&3 then you’ll see that they’ve sold quite a lot of millions of “smaller phones” over the last few years.Nah, it wasn't that. People just didn't want a smaller phone.
The demand is there even if it isn’t everyone’s favourite.
But I suspect that the margins are not (making tech smaller is expensive) and that’s why it’s missing features and not being promoted, so it doesn’t sell better than a higher margin phone.