Apple Reportedly Partners With Klarna to Launch Lease-to-Own Hardware Program
AI-generated image · Bay Street Wire
The new 'Apple Upgrade' initiative allows consumers to lease iPhones, iPads, and Macs as the company battles memory chip shortages and rising hardware costs.
Apple is teaming up with deferred payment processor Klarna to launch a lease-to-own initiative called "Apple Upgrade," according to reporting from Bloomberg via TechCrunch and The Verge. Scheduled to launch July 28, the program will allow customers to pay for Apple Watches and iPhones over 24-month terms, and Macs and iPads over 36-month terms.
Under the new system, users can return their devices, keep them, or upgrade to newer models at the end of the lease. The Verge reports that a soft credit check is required for sign-up. Certain budget-friendly models—including the iPhone 16, base iPad, Apple Watch SE, and MacBook Neo—will reportedly be ineligible for the program. Additionally, TechCrunch notes that some transactions may incur an additional fee.
The move comes as Apple navigates an industry-wide memory chip shortage known as "RAMageddon," driven by the AI sector's demand for memory. TechCrunch reports that Apple recently raised prices to combat these supply chain issues, suggesting the Upgrade program is intended to make those price hikes more palatable to consumers. The Verge adds that while the iPhone was excluded from the most recent price increases, the upcoming iPhone 18 Pro series may see higher pricing.
Apple Upgrade is designed to take the place of the existing iPhone Upgrade program and standard financing for new iPhones. Unlike the previous iteration, The Verge reports the new program will not include an AppleCare subscription. This pivot occurs during a transitional period for the company; TechCrunch reports that new CEO John Ternus is leading the firm amid a trade theft lawsuit against AI startup OpenAI.