The iPhone 16e is based on the iPhone 14 chassis, with various internal hardware components swapped out. Just like the previous iPhone SE was based on the iPhone 8. So I guess there was an assumption that maybe it uses the same battery as the 14.

But given that the cameras got swapped out for a single lens, the MagSafe magnets were removed, etc, it’s certainly conceivable that they freed up space internally for a larger battery in the 16e!