Where Has Apple’s R+D Billions Gone
Apple loves throwing around big slabs of money especially on so called research and development, but where does this money go, as the Company is struggling to deliver a new knockout product.
Let’s take last year, the US Company who are witnessing a slide in demand for their iPhones, iPads and MacBooks spent US $10 billion or A$13.3 Billion on R+D. That’s enough to build a new highway in Australia.
This was a 25% increase from the previous year, a gain made more notable by the fact that Apple’s revenue fell 8% during that time.
Apple’s R&D spending was less than 5% of its total revenue for the year. That is the lowest by far among the 10 largest tech companies by market cap. Google-parent Alphabet, Microsoft and Amazon.com have average R&D spending of 14% of trailing 12-month revenue. About 24% of Facebook’s trailing revenue has gone to R&D.
During the past few years Apple has looked at entering the TV market, the smart car market while also experimenting with new materials such as liquid metal.
Most of this investment has come to nothing.
The Wall Street Journal said recently that Apple is famous for its focus—often touting that it discards many ideas to concentrate on a few. Note that the company’s car project has reportedly been scaled back, and an oft-rumoured TV set has never appeared.