Story
Apple to Launch 'Upgrade' Device Leasing Program on July 28, Bloomberg Reports
Summary
Apple is reportedly set to launch a new subscription-style leasing program called 'Apple Upgrade' in the U.S. on July 28, partnering with Klarna to offer lower monthly payments and stimulate hardware sales.
Apple Inc. is preparing to launch a new device leasing program in the U.S. called Apple Upgrade on July 28, according to a Bloomberg News report citing people with knowledge of the matter. The initiative, designed to boost hardware sales, will be financially backed by a partnership with payments and shopping service Klarna Group.
Program Details and Strategy
The Apple Upgrade program will function as a subscription service, covering most iPhone, Mac, iPad, and Apple Watch models. It will be marketed as offering lower payments than the company's existing financing options and will be available through both Apple's retail stores and its online platform, the report stated.
The move comes as Apple has raised prices on many of its devices, excluding the iPhone, in response to surging costs for memory and storage chips. This cost pressure is largely driven by the high demand from the artificial intelligence industry's buildout of data centers. The new leasing program appears to be a strategy to make its products more accessible by lowering the upfront financial barrier for consumers.
Transition and Key Exclusions
AdTo streamline its offerings, Apple plans to discontinue new enrollments for its current iPhone Upgrade Program and standard financing plans, directing customers to the new Apple Upgrade service. Customers in the leasing program will have the flexibility to pay off their device early, upgrade to a newer model before their term is complete, or keep the device after the leasing period ends, according to Bloomberg.
However, the program will have several notable limitations. Key details from the report include:
- The service will not include AppleCare, a departure from the current iPhone Upgrade Program.
- Certain entry-level and new models, including the Apple Watch SE, the base iPad, the iPhone 16, and the MacBook Neo, will be ineligible.
- Purchases for business and education purposes will also be excluded.
Both Apple and Klarna did not immediately respond to a request for comment on the matter, Reuters reported.
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