Supposedly, previous iPhones had a lot of empty space near where the headphone jack would have been. Enough space for this guy[1] to drill a hole and install Apple's DAC in it.
Ha, I can only assume that on account of the obvious controversy, this was done by the engineers so they'd have an option to reverse course if the executives had a last-second change of heart. Once it was clear they really did have that space to work with, they filled it up with stuff.