Apple will introduce a Klarna-supported device leasing program named Apple Upgrade on July 28.

      Apple is set to introduce Apple Upgrade on July 28, a leasing initiative supported by Klarna for iPhones, Macs, iPads, and Apple Watches, which will replace its existing financing system. According to a Bloomberg report on Monday, this program represents a significant shift in the way Apple markets its hardware. It is said to accommodate most models of iPhones, Macs, iPads, and Apple Watches, as per sources cited by Bloomberg. Apple has not commented on the matter, and Klarna has not yet responded to inquiries.

      The leasing program operates similarly to a car lease. Customers have the option to pay off the device early, upgrade to a new model before the lease period is complete, or return the device at the end of the lease term, although some transactions may incur additional fees. Leases for iPhones and Apple Watches will last 24 months, while those for Macs and iPads will extend to 36 months. A soft credit check will be necessary for qualification.

      Apple plans to halt new sign-ups for its existing iPhone Upgrade Program and standard financing to facilitate the launch of Apple Upgrade, as reported by Bloomberg. The company aims to market this new program as a means to reduce monthly payments compared to current offerings. Unlike the iPhone Upgrade Program, Apple Upgrade does not come with AppleCare, which is significant considering that Apple recently increased AppleCare+ prices amid a broader surge in costs linked to the global memory chip shortage.

      Some Apple products will not be eligible for the program, including the Apple Watch SE, entry-level iPad, iPhone 16, and MacBook Neo, according to Bloomberg. Purchases for business and educational purposes are also excluded.

      This launch follows weeks after Apple hiked prices for Macs, iPads, and other devices due to a widespread memory shortage that has substantially increased component costs. There are also expectations of iPhone price increases with the release of new models in September. By positioning hardware as a monthly payment rather than a one-time cost, Apple Upgrade could mitigate price shock at a time when almost every product has become pricier.

      For Klarna, whose stock has significantly declined since its September 2025 IPO, this partnership signifies a key distribution success. Shares of the Swedish buy-now-pay-later company surged up to 11 percent following the announcement.

      Apple had been working on its own hardware subscription service beginning in 2022 but abandoned the project in late 2024 due to software issues and regulatory concerns, based on previous Bloomberg reports. By collaborating with Klarna, Apple can offer a leasing option without incurring financial risk.