Apple is launching a new subscription-style device leasing service called Apple Upgrade in the United States on July 28, partnering with Swedish buy-now-pay-later giant Klarna as the financing provider. The service will initially cover most iPhone, iPad, Mac and Apple Watch models and will be available through Apple’s retail stores and online channels, allowing customers to lease eligible devices with the flexibility to upgrade early, keep their device at the end of the term or switch to a newer model before the lease expires. Unlike conventional installment financing, Apple Upgrade will function more like a subscription service, lowering monthly payments compared with Apple’s current financing plans. Bloomberg reported that Apple intends to phase out new enrollments in its existing iPhone Upgrade Program and standard financing options. The company plans to exclude several lower-priced products, including the iPhone 16, MacBook Neo, Apple Watch SE and the entry-level iPad, and business and education purchases will not qualify. The new offering will not bundle AppleCare. The leasing initiative arrives as Apple grapples with rising manufacturing costs across its product lineup, having increased prices on several devices after memory and storage chip prices climbed sharply amid unprecedented demand from AI data center operators.