Klarna (KLAR) Stock Climbs 9% on Apple Device Leasing Partnership

Key Points

• Shares of Klarna rose 9% Tuesday following a Bloomberg report that Apple has chosen the fintech company to finance its new device leasing initiative, Apple Upgrade.
• Set to debut on July 28, the program will include most iPhone, Mac, iPad, and Apple Watch products, with lease durations spanning 24 or 36 months.
• The Apple Upgrade service functions as a subscription model, allowing customers to settle early, switch to newer devices, or retain their product after the lease period concludes.
• Apple plans to discontinue new sign-ups for its current iPhone Upgrade Program and traditional financing plans to facilitate this new offering.
• This collaboration comes after Apple abandoned its internal hardware subscription initiative in 2024.

A newly announced collaboration between Apple and Klarna for a device leasing platform called Apple Upgrade drove Klarna (KLAR) stock up 9% during Tuesday’s trading session. Apple (AAPL) shares also climbed, advancing approximately 0.82% on the announcement.

Klarna Group plc, KLAR

The new leasing service is scheduled to roll out on July 28 across U.S. retail locations and Apple’s online store.

Klarna will serve as the financing provider behind the program. Prospective customers must complete a soft credit inquiry to qualify for approval.

The Apple Upgrade program encompasses most iPhone, Mac, iPad, and Apple Watch variants. Lease agreements for iPhone and Apple Watch span 24 months, whereas Mac and iPad agreements extend to 36 months.

At the conclusion of their lease term, participants can choose from three paths: complete the remaining payment to own the device, exchange it for a more recent model, or retain the current device.

Existing Programs Being Phased Out

As part of the transition to Apple Upgrade, the tech giant will discontinue accepting new participants into its existing iPhone Upgrade Program and conventional financing alternatives.

The company will market the new platform as providing reduced monthly costs compared to previous options — although it should be noted that AppleCare protection isn’t bundled in, unlike the existing iPhone Upgrade Program.

Certain devices won’t be eligible. The Apple Watch SE, base-model iPad, iPhone 16, and MacBook Neo are omitted from the leasing program. Corporate and educational acquisitions are similarly excluded.

The Strategic Choice of Klarna

Apple had previously attempted to develop its own proprietary hardware subscription platform but discontinued those efforts in 2024. By collaborating with Klarna, Apple can deliver the leasing option without assuming the financial exposure on its own books.

For Klarna, securing Apple as a client represents a significant achievement. The Stockholm-based fintech has been diversifying its operations far beyond its original buy-now-pay-later services.

Apple’s valuation currently stands at approximately $4.80 trillion. The company’s price-to-earnings ratio sits at 39.53, approaching its decade-high mark of 42.04.

Regarding insider activity, Apple executives divested $87.6 million in shares over the past quarter, with zero insider purchases recorded during that timeframe.

Klarna’s shares finished Tuesday’s session up 9% after the Bloomberg disclosure, while AAPL gained roughly 0.82% for the day.

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