Back in September, Apple launched the iPhone 6 and its larger sibling, with screen sizes of 4.7 and 5.5 inches respectively. With the release of these devices, which were relatively bigger as compared to their predecessors, the company hoped to meet the demand of the audience who preferred smartphones with screen sizes around the 5" mark. This was a marked change from Steve Job's ideology who believed that 3.5 inches was better suited to the hand since it was easier to "get your hands around it." However, Apple might soon be making a return to this doctrine or so some reports suggest.
Above is a concept image of a 4" iPhone 5, which could now happen for the iPhone 6 series.
The Times of India states that The Electronic Times of Taiwan is citing supply chain sources, to report that Apple may launch a 4-inch iPhone in the second half of 2015. According to the source, Apple has reached this decision keeping in view people who prefer smaller devices and female users who might be having trouble holding the current generation of iPhone in one hand.
It is important to note that the company is concerned about the large sizes of its new devices to some extent, offering a 'Reachability Mode' on the iPhone 6 Plus, so users can operate the phone with one hand. However, with only a few other sources confirming the credibility of this rather unlikely rumor, we can only advise you to take this news with a grain of salt.