Apple Launches Klarna-Backed Leasing Program as It Briefly Hits $5 Trillion

A New Way to Own an Apple Device

Apple made two major headlines on Tuesday, July 28 — and both tell the same underlying story. The company unveiled a sweeping new leasing program called Apple Upgrade, and on that same day, its stock briefly crossed a $5 trillion market valuation for the first time in company history. The timing wasn't coincidental. Apple is aggressively working to keep its devices affordable and its customers upgrading more frequently, even as hardware prices climb.

Apple Upgrade is a new leasing program offered in partnership with buy-now, pay-later service Klarna, giving eligible customers the option to pay for Apple devices through monthly installments. The program is available for the iPhone, Apple Watch, Mac, and iPad on the Apple Store online, in the Apple Store app, and at Apple Store locations in the United States.

What It Costs and How It Works

Leasing prices start at $17.99 per month for iPhone, $11.99 per month for Apple Watch, $24.99 per month for Mac, and $11.99 per month for iPad. Apple Upgrade offers one- and two-year leasing options for iPhone and Apple Watch, and two- and three-year options for Mac and iPad. At the high end, leasing an iPhone 17 Pro can run up to $45.99 per month — but for many consumers, even that may feel more manageable than a four-figure upfront purchase.

No security deposit is needed, and the application involves only a soft credit check, leaving an applicant's credit score unaffected. When a lease term ends, customers have three paths: sign a new lease on an updated device, buy the current device outright, or simply hand it back and walk away. Trading in a current device through Apple Trade In can lower monthly payments, and customers who pay with Apple Card earn 3% Daily Cash back on lease payments.

The Problem Apple Is Trying to Solve

The rollout of the program comes as Apple has been struggling with supply chain issues related to "RAMageddon," an industry-wide shortage of memory chips driving up hardware prices — leading Apple to recently announce price hikes for its Mac and iPad lineups. Those shortages have been driven largely by the AI industry, which is consuming so much memory that it's squeezing supply for consumer electronics. The new Upgrade program appears to be Apple's answer to making those higher prices more manageable for consumers.

With the launch of Apple Upgrade, Apple is discontinuing the iPhone Upgrade Program and iPhone Payments in the United States. Customers currently enrolled in the iPhone Upgrade Program will have the option to lease a new device through Apple Upgrade, finance through Apple Card Monthly Installments, purchase outright, or use carrier financing. Klarna is not charging a fee for the leasing program, so an iPhone that's $1,099 can be leased and then purchased for $1,099 with no extra cost beyond taxes.

A $5 Trillion Company Making a Strategic Bet

On Tuesday, Apple became the second company in history to be valued at $5 trillion, joining Nvidia as the iPhone maker's shares surged in recent weeks, making it the world's largest firm by market capitalization. Shares rose as much as 1.8% to $342.89 shortly after trading opened, pushing Apple's market cap just above $5 trillion for the first time, before paring back gains. Apple now ranks ahead of Nvidia ($4.7 trillion), Alphabet ($3.9 trillion), and Microsoft ($2.9 trillion).

The leasing program is a smart play for a company at this scale. The average iPhone replacement cycle has stretched to nearly four years, meaning Apple leaves enormous revenue on the table with every customer who holds onto an older device. If Apple Upgrade succeeds in nudging even a fraction of its massive user base toward annual or biennial upgrades, the impact on both revenue and quarterly earnings consistency could be significant. For consumers, the pitch is simple: get the latest Apple hardware without the sticker shock — and always have an exit ramp when something newer comes along.