The Apple iPhone Upgrade Program is officially over. On July 28, 2026, Apple announced Apple Upgrade, a new hardware leasing program built in partnership with Klarna that replaces the iPhone Upgrade Program and iPhone Payments in the United States with a single unified leasing option covering iPhone, Apple Watch, Mac, and iPad. The program launched immediately on the Apple Store online, in the Apple Store app, and at Apple Store locations across the country, with monthly leases starting at $17.99 for iPhone, $11.99 for Apple Watch and iPad, and $24.99 for Mac. It is the most significant structural change to how Apple sells hardware in the US in nearly a decade, and it signals a deliberate shift from device financing toward a device leasing model that more closely resembles how customers already pay for software subscriptions.
What Is Apple Upgrade and How Does It Work
Apple Upgrade is a hardware leasing program provided by Klarna Inc. that offers 12- and 24-month leasing options for iPhone and Apple Watch, and 24- and 36-month leasing options for Mac and iPad. Customers apply online or in store, receive a soft credit inquiry that does not affect their credit score, and can receive approval within minutes. Once approved, they complete the transaction as usual, with in-store customers walking out with their device the same day and online customers choosing delivery or in-store pickup.
At the end of the lease term, customers have three options: upgrade to the latest generation device by entering a new lease, purchase the device outright with a one-time payment, or simply return it and exit the program. Lease information including the billing schedule and remaining payments is managed entirely through the Klarna app. Customers can lower their monthly payment at enrollment by trading in their current device through Apple Trade In, and can earn 3% Daily Cash back on lease payments made with Apple Card.
AppleCare can be added to any leased device, which Apple says makes returning a device and upgrading to a new one even easier since AppleCare+ covers accidental damage, theft, and loss protection. One important note for iPhone leasees: the program requires customers to select an eligible carrier, AT&T, T-Mobile, or Verizon, though all leased iPhones are always unlocked and can be switched to any carrier at any time subject to the carrier’s terms.
The Monthly Pricing: What Each Device Category Costs
The starting prices Apple published represent the lowest possible monthly payment for the entry-level device in each category on the longest available lease term. Real-world pricing for premium devices is meaningfully higher. iPhone leases start at $17.99 per month. An iPhone 17 Pro 256GB with a purchase price of $1,099 would run $31.99 per month on a 24-month lease or $45.99 per month on a 12-month lease, before any trade-in credit. Apple Watch leases start at $11.99 per month, with an Apple Watch Series 11 (GPS) 42mm running $11.99 per month on a 24-month lease or $21.99 on a 12-month lease. iPad leases start at $11.99 per month, with an 11-inch iPad Pro 256GB running $24.99 on a 36-month lease or $31.99 on a 24-month lease. Mac leases start at $24.99 per month, with a 14-inch MacBook Pro 16GB running $38.99 on a 36-month lease or $53.99 on a 24-month lease.
Customers should note that these prices exclude taxes and any trade-in credit. The advertised starting prices assume a trade-in is not included. All monthly payments are subject to credit approval and eligibility.
Which Devices Are Not Eligible for Apple Upgrade
The program does not cover the entire Apple lineup. Several products are explicitly excluded from Apple Upgrade: iPhone 16, iPhone 16 Plus, Apple Watch SE, MacBook Neo, Mac mini, iPad (A16), and Studio Display. The exclusions suggest Apple is positioning the program around its premium and mid-range devices rather than its entry-level hardware, and that certain products with existing promotional or carrier-subsidized positioning have been kept outside the program’s scope.
What Happens to iPhone Upgrade Program Customers
With the launch of Apple Upgrade, Apple will no longer offer the iPhone Upgrade Program or iPhone Payments in the United States. For customers currently enrolled in the iPhone Upgrade Program, Apple has outlined four transition options depending on their eligibility: lease a new device through Apple Upgrade, finance through Apple Card Monthly Installments at 0% APR, purchase the device outright, or choose carrier financing. Apple has not specified a hard deadline by which existing iPhone Upgrade Program customers must make this transition, beyond confirming the program is discontinued as of launch day.
The iPhone Upgrade Program launched in 2015 as a way for customers to get a new iPhone every year through a monthly installment plan administered through Citizens Bank, with the option to trade in mid-cycle. Its replacement by a Klarna-powered leasing model reflects both Apple’s broader financial services strategy, which has increasingly centered on Apple Card and Apple Pay, and Klarna’s growing role as a consumer financial partner following Apple’s relationship with Goldman Sachs winding down earlier in 2026.
The Klarna Partnership and What It Signals
Karen Rasmussen, Apple’s vice president of the Apple Store online, framed the partnership in straightforward terms in the official announcement: “At Apple, we put the customer at the center of everything we do, and we’re thrilled that Apple Upgrade offers our customers, both online and in-store, a more flexible way to pay for the products they love.” The choice of Klarna as the program’s financial partner is notable given Klarna’s recent public market debut and its profile as one of the most widely recognized buy-now-pay-later and consumer lending brands globally.
Klarna’s role in Apple Upgrade is more substantial than a simple payment facilitation arrangement. Klarna is the lessor, meaning the lease agreement is between the customer and Klarna Inc., with Apple as the retailer. This structure has significant implications for how customers’ credit relationships and end-of-lease obligations work, making it important for anyone considering enrollment to read the full Klarna lease terms rather than treating the agreement as a standard retail installment plan.
The Lease vs. Buy Distinction Every Customer Should Understand
The most critical piece of information about Apple Upgrade is one buried in the program’s fine print but fundamental to how it works. Apple Upgrade is a consumer lease, not a purchase or a loan. Customers who make 24 monthly payments of $31.99 for an iPhone 17 Pro do not own the phone at the end of that period. They have paid Klarna $767.76 across the lease term and must either pay an additional purchase fee to keep the device, enter a new lease to upgrade, or return the phone. Early termination can trigger substantial fees.
This distinction matters because the monthly payment amounts can feel comparable to installment financing, but the financial outcome at the end of the term is fundamentally different. Customers who want to own their device outright over time should use Apple Card Monthly Installments at 0% APR, which is still available and results in ownership. Customers who prefer always having the latest device and are comfortable not owning what they use are the clear target market for Apple Upgrade.
Latest Updates
Apple officially launched Apple Upgrade on July 28, 2026 via a press release on the Apple Newsroom. The Apple Newsroom confirmed all program details including the Klarna partnership, the full pricing structure across all device categories, the lease term options, the eligible and ineligible devices, the transition path for existing iPhone Upgrade Program customers, and the lease eligibility requirements. CNBC reported that Apple plans to lease iPhones for $17.99 a month through the Klarna deal, confirming the headline pricing and the program’s availability through the Apple Store. CNN confirmed that Apple will now let customers lease their next iPhone or Mac instead of buying it, framing the program as a structural shift in how Apple approaches hardware acquisition.
Sources: CNBC | Apple Newsroom | CNN
Broader Implications
Apple Upgrade represents a meaningful shift in how one of the world’s largest consumer electronics companies thinks about the relationship between hardware and recurring revenue. The iPhone Upgrade Program was designed around annual upgrades and installment financing. Apple Upgrade is designed around leasing, which keeps the device in Apple and Klarna’s balance sheet rather than the customer’s, creates a more predictable return and upgrade cycle, and positions Apple’s hardware more explicitly as a service with a recurring monthly cost. For customers who already pay monthly for Apple One, iCloud+, Apple TV+, and Apple Music, adding a $17.99 or $31.99 monthly line for the device itself is a natural extension of an already subscription-heavy relationship with the company. Whether consumers embrace that framing or resist it will determine how significant Apple Upgrade becomes in the company’s financial narrative over the next several years. For more Apple and tech coverage, visit thetechmarketer.com.
3. FREQUENTLY ASKED QUESTIONS
- What is Apple Upgrade and how is it different from the iPhone Upgrade Program?
Apple Upgrade is a new hardware leasing program launched by Apple on July 28, 2026, in partnership with Klarna. Unlike the iPhone Upgrade Program, which was an installment financing plan that eventually resulted in device ownership, Apple Upgrade is a true lease. Customers do not own the device at the end of the term unless they pay a separate purchase fee. Apple Upgrade also expands beyond iPhone to cover Apple Watch, Mac, and iPad.
- How much does it cost to lease an iPhone through Apple Upgrade?
iPhone leases through Apple Upgrade start at $17.99 per month. An iPhone 17 Pro 256GB at its $1,099 purchase price runs $31.99 per month on a 24-month lease or $45.99 per month on a 12-month lease, before taxes and any trade-in credit. Customers can lower their monthly payment by trading in a current device through Apple Trade In at enrollment.
- Which Apple devices can be leased through Apple Upgrade?
Apple Upgrade covers iPhone, Apple Watch, Mac, and iPad. Excluded devices include iPhone 16, iPhone 16 Plus, Apple Watch SE, MacBook Neo, Mac mini, iPad (A16), and Studio Display. Eligible devices span the full current iPhone 17 lineup, Apple Watch Series 11 and Ultra 3, MacBook Air with M5, MacBook Pro with M5, iMac with M4, Mac Studio, iPad Air, iPad Pro, and iPad mini.
- What happens to existing iPhone Upgrade Program customers?
Apple has discontinued the iPhone Upgrade Program and iPhone Payments in the United States. Existing customers have four transition options: enroll in Apple Upgrade to lease a new device, finance through Apple Card Monthly Installments at 0% APR, purchase their device outright, or choose carrier financing. Apple has not announced a specific hard deadline for the transition.
- Do you own the device at the end of an Apple Upgrade lease?
No. Apple Upgrade is a consumer lease, not a purchase or loan. At the end of the lease term, customers must either upgrade to a new device by entering a new lease, pay a one-time purchase fee to keep the device, or return it and exit the program. Customers who want to own their device outright should use Apple Card Monthly Installments at 0% APR, which remains available and results in full ownership.
4. SOURCES AND REFERENCES
- CNBC: Apple Plans to Lease iPhones for $17.99 a Month Through Klarna Deal
- Apple Newsroom: Apple Upgrade Launches in the United States
- CNN: Apple Will Now Let You Lease Your Next iPhone or Mac Instead of Buying It
