This actually makes a lot of sense as you can discount prices, and actually have a phone that outperforms midrange phones.
Flagship phones get all the updates still, usually for a good 2 to 3 years, and quite often the previous model is not really a way lower spec model than the latest version.
I got relatively ripped off buying the Galaxy S23 Ultra just when it was released. The inflated price included a voucher (which turned out to be utterly useless as it expired after only 3 months, but that was not stated clearly anywhere). I could buy this phone today at a good 30 to 40% less, and it is still an excellent phone.
Also, with a good enough phone now, I can wait a bit longer until today’s models are a year or so old before buying again.