Apple is making it easier to get the latest gadgets without buying them outright. The company is launching a device leasing program in the U.S. in partnership with Klarna, the buy-now-pay-later provider. Instead of paying full price upfront, you can rent an iPhone for a monthly fee and hand it back when you are done.
The starting price is $17.99 a month for an iPhone, and you can choose between a one-year or two-year lease. For Macs and iPads, the lease options stretch to two or three years. A two-year lease of an unlocked iPhone 17 Pro will run you $31.99 a month. If you want to upgrade faster, a one-year lease on the same phone costs $45.99 a month.
This is not the same as Apple's old iPhone Upgrade Program, which required a financed loan through Citizens Bank and included AppleCare. That program cost more than $42 a month. The new leasing option is handled by Klarna instead of a bank.
Carriers like AT&T, Verizon, and T-Mobile already offer their own device installment plans. Apple's more affordable models, like the iPhone 16 and MacBook Neo, are excluded from this leasing option.
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Apple has a good reason to focus on monthly payments. Apple has bumped up the cost of its iPads and Macs by $100 or more, and a few configurations went up over $1,000, citing a worldwide memory shortage. Market analysts predict that iPhone prices will rise in the coming year.
According to Morgan Stanley, to protect its gross margin, Apple could increase the iPhone 18 Pro's price by about $200. TechInsights notes that increased memory and other component expenses might tack on up to $300 to an iPhone's production cost.
Leasing lets Apple emphasize a lower number: $17.99 a month sounds a lot cheaper than a full upfront price. That could convince more people to sign up. It also helps Apple smooth out its business.
Investors have long believed that installment plans could even out the seasonal fluctuations in Apple's business and lessen its dependence on blockbuster device launches for revenue. Additionally, this leasing initiative might motivate users to upgrade their phones more frequently, as the typical iPhone replacement interval has lengthened to almost four years, per Bernstein.
Senior research director at IDC Nabila Popal put it this way: "Most of Apple's consumers, especially in the U.S. and other developed markets, are buying devices on installment plans or trade-ins, so we can expect to see much more aggressive offers." The leasing program fits that trend.
The announcement comes at a busy time for Apple. Apple is set to announce its third-quarter financial results on Thursday. This will be Tim Cook's last earnings call as CEO before he moves into the role of executive chairman.
Analysts are watching for news about a possible price hike on the iPhone 18 Pro and the debut of a foldable phone expected around September 2026. That foldable could cost roughly $2,500, according to analyst estimates.
Apple's new leasing program competes directly with carrier installment plans from AT&T, Verizon, and T-Mobile. Apple also offers zero-interest financing through Apple Card Monthly Installments, and for Apple Pay users, short-term loans are available from Klarna or rival Affirm.
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