Apple is set for a possible summer launch of the next iPhone rather than an autumn launch like the last two models, The Wall Street Journal says.
Apple is also working on a cheaper iPhone model that could win it some market share in developing countries, the paper says. It cited unnamed people "familiar with the device's production".
The report is in line with the expectations of company watchers and Wall Street analysts.
The iPhone 5 costs around 600 US dollars (£397), and while Apple maintains older iPhones in production, even those are not cheap enough to compete effectively against low-end smartphones running Google's Android software.
Apple does not comment on future products before its launch events.