Apple has agreed to pay a total of $250 million (£184 million) to settle a lawsuit brought by iPhone users who accused the company of misleading them over its artificial intelligence features.

The settlement, filed in a California federal court on Tuesday, allows Apple to avoid admitting any wrongdoing while resolving a consolidated class action case that was initiated last year.

At the centre of the dispute were claims that the company overstated the capabilities of its AI system branded as Apple Intelligence, particularly improvements promised for its voice assistant Siri.

Plaintiffs argued that marketing materials suggested features that were either unavailable or significantly delayed.

As part of the agreement, eligible US customers who purchased an iPhone 15 or iPhone 16 between June 2024 and March 2025 will receive compensation ranging from $25 to $95.

An Apple spokeswoman defended the company’s position, saying the dispute centred on “the availability of two additional features” within a broader suite of updates released under the Apple Intelligence rollout.

“We resolved this matter to stay focused on doing what we do best, delivering the most innovative products and services to our users”, she said.

Lawyers representing the class of iPhone buyers amended their complaint last week, alleging that Apple’s promotional campaign misrepresented its AI capabilities and misled consumers.

“Apple promoted AI capabilities that did not exist at the time, do not exist now, and will not exist for two or more years, if ever, all while marketing them as the breakthrough innovation,” lawyers wrote.

They further claimed Apple accelerated its push into artificial intelligence to compete with emerging rivals such as OpenAI and Anthropic in the fast-growing sector.

The lawsuit also pointed to broader scrutiny of Apple’s innovation strategy under outgoing chief executive Tim Cook, who has faced criticism in recent years over the company’s pace of product development.

According to the filing, Apple’s marketing suggested that Apple Intelligence would deliver a major upgrade to Siri, transforming it from a “limited voice interface into a full-fledged personal AI assistant”.

“The iPhone 16 was delivered to consumers without “Apple Intelligence,” and Enhanced Siri never came,” the lawyers wrote.