Apple partners with Klarna on device leasing amid chip price hikes

Apple is set to launch a new lease-to-own programme for its hardware, partnering with European payment processor Klarna. The initiative, called Apple Upgrade, will go live on July 28. It will replace the company’s existing iPhone Upgrade programme for new sign-ups.

Consumers will be able to spread the cost of iPhones, iPads, Macs, and Apple Watches over multi-year periods. Leases for phones and watches will span up to 24 months, while Macs and iPads will have terms up to 36 months. At the end of the term, customers can keep the device, return it, or upgrade to new hardware, though some transactions will incur additional fees.

The deal is a notable win for European payment processor Klarna, securing a high-profile partnership with a major tech company. For Apple, the programme is a direct response to mounting supply chain pressures that are driving up consumer prices. An industry-wide shortage of memory chips—dubbed “RAMageddon”—has pushed hardware costs higher.

This chip scarcity is largely driven by the artificial intelligence sector, which is consuming vast quantities of memory and leaving limited supply for consumer electronics. Apple recently announced price increases to navigate these constraints. The Klarna partnership is designed to soften the blow of those hikes, making expensive devices more accessible to consumers through monthly instalments.

Shifting hardware sales to a recurring lease model also helps Apple stabilise its revenue at a turbulent time. The company is navigating a leadership transition under new chief executive John Ternus. It is also engaged in a legal battle with AI startup OpenAI over alleged trade theft.

For investors, the move signals how supply chain bottlenecks in the AI era are forcing hardware makers to rely on fintech solutions to maintain sales volumes. By embedding Klarna’s deferred payment infrastructure into its checkout process, Apple is effectively softening its own price hikes. This strategy ensures consumers continue buying devices despite tighter household budgets.