Apple has unveiled Apple Upgrade, a leasing program in collaboration with Klarna, aimed at customers looking to lease iPhones, iPads, Macs, and Apple Watches. This move signifies the end of new enrollments in the existing iPhone Upgrade Program. While this introduces more options for upgrades, it also prompts users to consider the financial implications.
Understanding Apple Upgrade
The Apple Upgrade program allows customers to rent Apple devices by paying a monthly fee, with various lease terms available depending on the product. At the lease’s conclusion, users can upgrade to a newer device, opt to purchase the leased item outright, or return it and exit the program.
Available across the United States, Apple Upgrade can be accessed online, via the Apple Store app, or in physical Apple retail locations. The application process involves a soft credit check, which does not impact the applicant’s credit score.
Simultaneously, the initiation of Apple Upgrade marks the cessation of the iPhone Upgrade Program. This previous program allowed customers to finance an iPhone over 24 months, becoming eligible for an upgrade after 12 payments. The shift comes amid internal changes at Apple as they transition from CEO Tim Cook to John Ternus, scheduled to take place on September 1, 2026.
Comparing Apple Upgrade and iPhone Upgrade Program
For those accustomed to upgrading their iPhone annually, the key difference to note is the monthly cost. The Apple Upgrade program advertises a monthly cost reduction of approximately $11 less compared to the iPhone Upgrade Program for the iPhone 17 Pro Max series.
Why Apple’s New Program Seems Cheaper
The primary reason for the reduced cost per month is the removal of AppleCare+ with Theft and Loss from the bundled payment in the old iPhone Upgrade Program. Existing members of this program retain their coverage as long as the financing agreement remains active.
With Apple Upgrade, AppleCare+ needs to be purchased separately. Reports suggest the cost of AppleCare+ with Theft and Loss for current Pro-level iPhones is around $13.99 per month or $139.99 annually. This means the supposed $134 annual savings are nearly negated if customers add the separate coverage.
Lease Conclusion Options
The shift also brings a change in ownership structure. Under the iPhone Upgrade Program, customers owned their phone after completing a 24-month loan. Existing users can continue payments until they own the device.
In contrast, Apple Upgrade users lease devices through Klarna and must choose to buy, return, or lease a new device at the term’s end. Customers can reduce payments by trading in a device when signing up and can earn 3 percent Daily Cash using Apple Card.
Apple’s Perspective
Apple states that the program aims to provide more flexibility while broadening upgrade options from just iPhones to include Macs, iPads, and Apple Watches. The monthly lease begins at $17.99 for iPhones, $11.99 for Apple Watches, $24.99 for Macs, and $11.99 for iPads.
Newsweek has contacted Apple for further comment but is yet to receive a response.
Key Considerations
For consumers upgrading iPhones annually, the new Klarna-backed Apple Upgrade program seems to offer an annual saving of around $134 based on advertised payments. However, the exclusion of AppleCare+ with Theft and Loss changes the actual cost benefit when the coverage is considered separately. The significant change likely revolves around transitioning customers from a financing model involving ownership and protection to a leasing model emphasizing flexibility and recurring upgrades.
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