Apple Launches 'Apple Upgrade' Lease-to-Own Program With Klarna on July 28

Apple will launch Apple Upgrade on July 28, a lease-to-own program backed by Klarna that spreads the cost of iPhones, iPads, Macs and Apple Watches across multi-year payment plans — the company's most aggressive move yet to convert device ownership into a subscription.

How it works

The program, first reported by Bloomberg, offers 24-month leases for iPhones and Apple Watches and 36-month terms for Macs and iPads. Unlike a traditional installment plan, Apple Upgrade behaves like a subscription: customers can upgrade mid-term to a newer model without waiting out the lease, pay off the balance early to own the device, keep making payments, or hand the hardware back at the end.

Enrollment — available through Apple Stores and online — requires only a soft credit check, lowering the barrier relative to conventional financing. Klarna provides the financial backing. Some devices are excluded at launch, including the iPhone 16, the entry-level iPad and Apple Watch SE.

Why Apple wants you renting

The strategic logic is straightforward: upgrade cycles have stretched as phones got good enough, and leasing resets the clock. A customer on a rolling 24-month lease is a customer who never comparison-shops, churns predictably into new hardware, and feeds Apple's certified-refurbished pipeline with returned devices.

For Klarna, fresh off its IPO, the deal is a landmark — embedding the Swedish fintech into the world's most valuable consumer hardware franchise. For carriers and buy-now-pay-later rivals, it is a shot across the bow: Apple now controls the financing relationship, not just the device.

The launch comes as Apple leans harder on services and recurring revenue while navigating a slower iPhone supercycle — and as its China AI rollout with Alibaba's Qwen finally clears the runway. Analysts will watch whether leasing lifts unit volumes into the iPhone 18 cycle, due this fall.