Apple’s R&D Spend Ctinues To Rise, But Not Directly Related To Anything

The company has just increased its research and development budget for the 15th csecutive year, but this is not a direct sign that new product categories are emerging.

Every two or three years we see a new Apple device, such as the HomePod, AirPods, Apple Watch, etc., the iPhone and the iPad. We also see that the company spends more and more mey research and development. But what we do not see and it seems that we will never do it is a correlati between these two things. For example, HomePod was announced in June 2017, but you will not find an increase in spending of six mths, a year or even two years earlier.

It is very tempting to try it, especially when Apple announced that it had spent $ 760 milli more R & D than last year. This brings this third fiscal quarter to $ 3.7 billi.

At the same time, we have to see three new iPhones before the end of the year, perhaps new iPads and maybe also new Apple watches. These are ly rumors, but they are not the ly es: it is also possible that we see new iMac, a new Mac mini, and at least a glimpse of the promised Mac Pro.

Even if we get a fracti, it will be a busy year for Apple. It is easy to assume that this is the reas he spent more research and development, but that does not seem to be the case.

Although Apple's profits have risen sharply in recent years, the R & D activities have grown gradually

You can see two peaks around the first quarters of 2017 and 2018. But they are not important and they are both overshadowed by the steady rise that ctinued after them.

Given the industry, it is no surprise that Apple is dealing with R & D. It is therefore not surprising that extra mey will be allocated when these funds become available. It is surprising that almost all of Apple's major competitors spend more and sometimes a lot more than they do.

Bernstein Research, a company that claims to be ranked first for "Better knowledge of US companies and industries for 14 years", thinks Apple is hurting it.

In a Bernstein analysis reported by BarrsTi Saccaghi's financial website analyst, says, "While current R & D expenditures for Apple are substantial, our comparative analysis suggests that Apple still appears to have R & D spending, perhaps with a factor two. "

There is some support for the analysis. "We looked at Apple and the 25 largest technology companies," he ctinued, "and found a fairly strg correlati between R & D as a percentage of revenue and gross margin."

He said before this week's results that Bernstein thought Apple had spent 5.1% of its revenue R & D, which is lower than its competitors. "Apple could double its R & D and be able to adapt relatively to its colleagues."

In April, Amaz released $ 22.6 billi in R & D last year in a specific report US technology companies, an increase of 41% over 2016. According to the same data, the Google alphabet spent $ 16.6 billi dollars.

Then Intel spent $ 13.1 billi and Microsoft $ 12.3 billi. For the same period, reports that Samsung has spent $ 12.7 billi.

Ne of these companies has the kind of profit report that Apple still has.

Previously, Apple had spent too little R & D every competitor, but the fact that Samsung correspds with Samsung this time should decrease further. Apple is seriously engaged in R & D but has not paid any mey.

In 1998 Steve Jobs told Fortune magazine: "Innovati has nothing to do with the amount of dollars spent R & D."

"When Apple developed the Mac, IBM spent at least 100 times more R & D," Jobs said. "It's not mey, it's about the people you have, the way you are and what you get.

Apple's research and development costs are not limited to the approaching arrival of a new product, but do not do so during periods of calm. He ctinues to finance everything that Apple does at all times.

It is the driving force here, the need to spend what needs to be spent to reach the product which Apple works. The company clearly will not double its R & D spending as an analyst says everye is. And so far, Apple's approach has worked well for 15 years.

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