When standard light sources are employed, the precision of the phase determination is limited by the shot noise. Quantum entanglement provides means to exceed this limit with the celebrated example of N00N states that saturate the ultimate Heisenberg limit on precision, but at the same time are extremely fragile to losses. In contrast, we provide experimental evidence that appropriately engineered quantum states outperform both standard and N00N states in the precision of phase estimation when losses are present.