Apple Inc. is launching a new leasing program called "Apple Upgrade" for customers in the U.S. starting Tuesday.

This shift represents a strategic pivot in how Apple sells hardware. By moving toward a leasing model, the company aims to maintain demand as the cost of high-end electronics rises due to supply chain pressures.

Partnering with Klarna, the program allows customers to lease iPhones for as low as $17.99 per month [1]. These lease terms can extend for up to two years [1]. This initiative officially replaces the previous iPhone Upgrade Program, transitioning from a financing-heavy model to a dedicated leasing structure [3].

The leasing options extend beyond smartphones to include other hardware in the Apple ecosystem. Customers can lease an Apple Watch or an iPad starting at $11.99 per month [4]. For those seeking higher-end computing, Mac leases are available starting at $24.99 per month [4].

Apple said it introduced the leasing option to provide more flexible financing for its user base. The move follows recent price increases for iPads and Macs, which the company said were due to a global memory shortage [1]. By lowering the monthly entry point, Apple can keep its latest hardware accessible to consumers who cannot afford the full retail price upfront.

The partnership with Klarna integrates the fintech company's payment infrastructure into the Apple purchasing experience. This allows the company to offer these tiered monthly payments without managing the entirety of the credit risk internally, a move that mirrors the growth of "buy now, pay later" services across the retail sector.

“Apple is launching a new leasing program called "Apple Upgrade" for customers in the U.S.”

The transition to a leasing model suggests that Apple is prioritizing monthly recurring revenue and hardware churn over one-time sales. By leveraging Klarna's infrastructure, Apple can mitigate the impact of rising component costs—specifically the global memory shortage—while ensuring that the high cost of new devices does not deter consumers from upgrading every two years.