Apple Spends Less, But Gets More From Its R&D Spending

From Apple’s SEC filing, Apple spent $3.4 billion on R&D in 2012. That’s a huge number, but in terms of their competitors, it doesn’t seem like a large number at all, but does that even matter?

Mashable pulled together a comparison of some of Apple’s main competitors and their R&D spend, and Apple lags pretty far behind many of them. From Mashable:

Microsoft: $9.8 billion in 2012 FY, or 13% of sales

Nokia: $7.3 billion in 2011 FY, or 14.5% of sales

Amazon: $2.9 billion in 2011 FY, or 6.1% of sales

HP: $3.3 billion in 2011 FY, or about 3% of sales

Samsung: $9.1 billion in 2011 FY, or 6% of sales

Google: $5.2 billion in 2011 FY, or 13.6% of sales

Apple spends about 2% of sales on R&D (flat year over year 2011 vs 2012), which almost seems paltry, however consider this statement from Seth Fiegerman’s post:

What’s so impressive is that even though Apple allocates less money to research than its competitors, it seems to reap more rewards per dollar spent. Consider that in the 12 month timeframe represented in this report, Apple developed and released a new iPhone, two new iPads as well as introducing the iPad Mini and completely refreshing its line of MacBooks and iPods.
Via: Apple Ramps Up R&D Spending, Still Far Less Than Competitors’ [CHART]

The manufacturing advancements alone are amazing. Then looking at some of the improvements in displays, connectors, and other parts of the hardware mix, Apple gets a lot of bang for their buck. But…

What about software and new hardware designs?

This, I think most of us would agree, is where Apple is falling short. Sure iOS is great, but iOS 6 isn’t too different than iOS 4, heck maybe even earlier. While both the iPad and iPhone are amazing devices, when was the last time did something that made our jaws drop?

It’s been a while, certainly.

The problem is that, making break throughs or coming up with the “next big thing” isn’t something that you can just throw lots of money at to fix. It takes a team of people and a culture of risk that will make the difference.

AAPL R&D Expense Quarterly Chart

AAPL R&D Expense Quarterly data by YCharts

Will this week’s changes at Apple let them take better advantage of the money they spend? Will Apple start spending more? Where is the next push going to be?

Chime in folks.

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Categories: Apple News

  • iPhone 4

    Not exactly an apples to apples comparison. Their is a fair amount of research that won’t hit the consumer market from all these companies, some more than others. Google has Project Glass, driver less cars, Google Fiber, etc. Samsung invests quite a bit in keeping all their factories up to date and research in chips, nand memory, lcds, and a lot more. Fairly sure Apple also has research not yet ready for the market but out of most of these companies I think they are the most directed to the immediate consumer market.

  • Matt

    Lol Samsung sure spent a lot of money to copy apples stuff!

    Sorry that’s just for humor, though most won’t see it that way.