Apple Upgrade Launches July 29: iPhone Leasing Starts at $17.99/Month

Apple launched its Apple Upgrade leasing program on July 28, partnering with buy-now-pay-later provider Klarna to let U.S. customers rent iPhones for as little as $17.99 per month. The move replaces Apple’s older iPhone Upgrade Program and arrives as analysts expect significant price increases on new models. The program shifts focus from high upfront costs to lower monthly payments, helping Apple smooth seasonal demand and encourage faster device replacements.

How the Apple Upgrade program works

Customers can lease iPhones for 12 or 24 months, with prices starting at $17.99 monthly for the base model. Macs and iPads offer 24 or 36-month terms at $24.99 and $11.99 per month respectively. Apple Watches cost $11.99 monthly for 12 or 24-month leases. After the lease ends, customers can return the device, purchase it outright, or upgrade to a newer model. Klarna conducts a soft credit check that does not affect credit scores.

Why Apple is pushing leasing now

Apple raised iPad and Mac prices by $100 or more in June, citing global memory shortages. Analysts predict iPhones will follow suit, with Morgan Stanley estimating a $200 price increase on the iPhone 18 Pro. Leasing lets Apple emphasize a lower monthly number rather than a higher sticker price. The program also helps smooth revenue across quarters and encourages customers to replace devices sooner, as the average iPhone replacement cycle has stretched to nearly four years.

Additional benefits and trade-in options

Customers can lower monthly payments by trading in an existing device through Apple Trade In. Those using an Apple Card earn 3 percent daily cash back on lease payments. The iPhones come unlocked, meaning they work internationally without carrier restrictions. Unlike the old iPhone Upgrade Program, which cost over $42 per month and required a Citizens Bank loan plus AppleCare, the new Klarna-backed program offers lower entry pricing. Devices must be returned in original condition or face wear-and-tear charges, though customers can add AppleCare insurance for extra protection.

What this means for Apple and investors

The program replaces Apple’s previous iPhone Upgrade and iPhone Payments offerings entirely. With Meyka grading AAPL a B and 15 analysts rating it a Buy versus 5 Holds and 4 Sells, the stock reflects mixed sentiment on valuation. The leasing strategy addresses investor concerns about slowing upgrade cycles and helps Apple capture price-sensitive customers who might otherwise delay purchases. The program’s success could smooth quarterly earnings and reduce dependence on seasonal iPhone launches for growth.

Final Thoughts

Apple’s new leasing program lowers the barrier to entry for iPhone upgrades while masking expected price hikes behind lower monthly payments. The strategy benefits Apple’s revenue predictability and upgrade velocity, though financial analysts note that leasing a $599 iPhone for $17.99 per month over 24 months costs $432 without ownership, making outright purchase and resale a better deal for value-conscious buyers.

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The content shared by Meyka AI PTY LTD is solely for research and informational purposes.  Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.