Why it's trending
The announcement on July 28, 2026, coincides with rising device prices and a trend toward installment plans. Apple is seeking to smooth revenue and encourage more frequent upgrades, with the average iPhone replacement cycle now nearly four years.
Apple announced Apple Upgrade, a leasing program provided by Klarna, available in the U.S. starting July 2026. Customers can lease an iPhone for as low as $17.99 per month over 12 or 24 months, with similar options for Apple Watch, Mac, and iPad. The program aims to reduce upfront costs and is available on Apple's online store, app, and physical stores.
According to Apple's press release, customers can further lower monthly payments by trading in their current devices through Apple Trade In. Those using Apple Card can earn 3% Daily Cash on lease payments. Klarna handles the application process with a soft credit inquiry that doesn't affect credit scores. No security deposit is required, and while no late fees are charged, leases are terminated after three missed payments.
CNBC reports that the launch follows Apple's recent price hikes on iPads and Macs due to a global memory crunch, with analysts expecting similar increases for iPhones. IDC's Nabila Popal noted that most consumers already use installment plans, so aggressive offers are likely. Bernstein estimates the average iPhone replacement cycle has stretched to nearly four years, suggesting the lease could shorten upgrade cycles.
The program shifts Apple's business model toward recurring payments, reducing reliance on hit device cycles. Customers must return devices at lease end, with options to purchase or upgrade. This mirrors strategies from carriers but is Apple's first direct leasing program. The partnership with Klarna also marks a deeper integration of buy-now-pay-later services in Apple's ecosystem.
Timeline
- Apple announces Apple Upgrade program
Apple unveils a leasing program via Klarna for iPhones, Apple Watches, Macs, and iPads, with monthly payments starting at $17.99 for iPhone. Available in U.S. Apple stores and online.
- Apple raises iPad and Mac prices
Citing a global memory crunch, Apple increased starting prices by at least $100 on iPads and Macs, signaling potential iPhone price hikes.
- Growing average iPhone replacement cycle
Bernstein estimates average iPhone replacement cycle reached nearly four years, motivating Apple to encourage more frequent upgrades via leasing.
Questions people ask
How much does it cost to lease an iPhone via Apple Upgrade?
Prices start at $17.99 per month for a 12- or 24-month lease. Higher-end models cost more; for example, an iPhone 17 Pro costs $31.99/month for 24 months or $45.99 for 12 months.
What happens at the end of the lease?
Customers must return the device. They can choose to purchase it for an additional payment or upgrade to a new device.
Is there a credit check?
Yes, a soft credit inquiry is performed by Klarna, which does not impact the applicant's credit score.
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