Apple's R&D expenses surge 33%, on pace to top $4 billion this year
Apple's research and development related expenses have grown by 33 percent this year and are on pace to top $4 billion in fiscal 2013, as the company toils away on new "surprises" in its top-secret labs.
Apple spent an additional $278 million on research and development expenses in the recently concluded March quarter, the company revealed this week in a filing with the U.S. Securities and Exchange Commission, as discovered by AppleInsider. Compared to the same period in 2012, it's an increase of 33 percent.
R&D spending for the first six months of Apple's fiscal year 2013 is now up $530 million year over year, which is also a 33 percent increase from the first six months of fiscal 2012. At that pace, spending will grow by more than $1 billion this year alone.
In the SEC filing, Apple said the new expenses were "due to an increase in headcount and related expenses to support expanded R&D activities." It characterized such expenses as "critical to its future growth," and signaled that further investments in research and development will continue.
At its current pace, Apple should easily surpass $4 billion total in research and development expenses this fiscal year. In comparison, Apple spent a total of $3.4 billion on R&D in fiscal 2012.
Apple's R&D expenses have continued to swell in the last few years. Last year alone, Apple's total R&D investment rose by 39 percent, or $953 million.
While R&D spending is growing at a noteworthy clip, the money spent is still a fraction of what Apple collects in cash and investments. Apple's cash pile swelled to nearly $145 billion last quarter, which has prompted the company to spend $100 billion through the end of calendar 2015 on share repurchases and dividend payouts.
Of course, it's the development of new products that boosts Apple's bottom line, which is why outsiders have become so curious as to what the company might be working on. Since the unveiling of the iPad mini last October, Apple has not held a keynote presentation to launch a major new product.
While new iPhones, iPads and Macs are expected to debut by this fall, speculation has been rampant that Apple is working on devices that could enter the company into new product categories where it does not currently compete. Rumored products include a low-cost iPhone that could be sold affordably without a contract subsidy, a full-fledged television set, and even a wearable smart wrist watch.
Apple Chief Executive Tim Cook fueled speculation when he said during his company's quarterly earnings conference call on Tuesday that there are "a lot more surprises in the works" at Apple. He also said that Apple was looking at offering devices in new product categories, as well as new services, in comments that were unusually candid for the normally tight-lipped operation.
Apple spent an additional $278 million on research and development expenses in the recently concluded March quarter, the company revealed this week in a filing with the U.S. Securities and Exchange Commission, as discovered by AppleInsider. Compared to the same period in 2012, it's an increase of 33 percent.
R&D spending for the first six months of Apple's fiscal year 2013 is now up $530 million year over year, which is also a 33 percent increase from the first six months of fiscal 2012. At that pace, spending will grow by more than $1 billion this year alone.
In the SEC filing, Apple said the new expenses were "due to an increase in headcount and related expenses to support expanded R&D activities." It characterized such expenses as "critical to its future growth," and signaled that further investments in research and development will continue.
At its current pace, Apple should easily surpass $4 billion total in research and development expenses this fiscal year. In comparison, Apple spent a total of $3.4 billion on R&D in fiscal 2012.
Apple's R&D expenses have continued to swell in the last few years. Last year alone, Apple's total R&D investment rose by 39 percent, or $953 million.
While R&D spending is growing at a noteworthy clip, the money spent is still a fraction of what Apple collects in cash and investments. Apple's cash pile swelled to nearly $145 billion last quarter, which has prompted the company to spend $100 billion through the end of calendar 2015 on share repurchases and dividend payouts.
Of course, it's the development of new products that boosts Apple's bottom line, which is why outsiders have become so curious as to what the company might be working on. Since the unveiling of the iPad mini last October, Apple has not held a keynote presentation to launch a major new product.
While new iPhones, iPads and Macs are expected to debut by this fall, speculation has been rampant that Apple is working on devices that could enter the company into new product categories where it does not currently compete. Rumored products include a low-cost iPhone that could be sold affordably without a contract subsidy, a full-fledged television set, and even a wearable smart wrist watch.
Apple Chief Executive Tim Cook fueled speculation when he said during his company's quarterly earnings conference call on Tuesday that there are "a lot more surprises in the works" at Apple. He also said that Apple was looking at offering devices in new product categories, as well as new services, in comments that were unusually candid for the normally tight-lipped operation.
Comments
Amazing considering where they were in the mid 90's
Just Amazing.....
Their R&D budget this year is nearing their market cap when Jobs took over. So is the revenue of their "break even" iTunes Store.
Quote:
Originally Posted by AppleInsider
Apple's research and development related expenses have grown by 33 percent this year and are on pace to top $4 billion in fiscal 2013, as the company toils away on new "surprises" in its top-secret labs.
The Samsungs of the world thank you Apple for letting them avoid paying for their own R&D.
Quote:
Originally Posted by sflocal
The Samsungs of the world thank you Apple for letting them avoid paying for their own R&D.
don't forget the courts that continue to allow the likes of samsung, google, et al, to benefit from apple's r & d.
Quote:
Originally Posted by DGNR8
Wow they spend as much on R&D as some countries GDP.
Amazing considering where they were in the mid 90's
Just Amazing.....
You have to get to the real doldrums of tiny countries before you find one that has $4bn of GDP. Not really worth the comparison.
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)
Mostly island nations, city states, or impoverished African nations.
Apple spends more on R&D than Google's profit.
Quote:
Originally Posted by Rogifan
Ah, but don't [insert company names here] spend more R&D as a percent of revenue or whatever than Apple does? I mean that's what we hear every day from Wall Street.
So true!! We all know that $4 billion dollars is actually less than a $100 million dollars that others spend... /s
Quote:
Since the unveiling of the iPad mini last October, Apple has not held a keynote presentation to launch a major new product.
Of course it hasn't. That was only 6 months ago! It is extremely unreasonable for anyone to expect major new product launches twice a year!
Quote:
Originally Posted by Rogifan
Ah, but don't [insert company names here] spend more R&D as a percent of revenue or whatever than Apple does? I mean that's what we hear every day from Wall Street.
Google, Microsoft, Samsung, Intel, Nokia spend much more than Apple (not just as %).
Quote:
Originally Posted by Plagen
Apple spends more on R&D than Google's profit.
No it doesn't! Google annual profit is over $12b i.e. more than Apple's annual R&D
Quote:
Originally Posted by arch
Google, Microsoft, Samsung, Intel, Nokia spend much more than Apple (not just as %).
Google's R&D budget is basically used for acquisitions of other smaller companies - I don't think there's been another company that buys up more companies since Microsoft in the 90's.
Quote:
Originally Posted by malax
I've always wondered this: does "R&D" (research and DEVELOPMENT) include all the software development costs? Or is it only the more abstract/skunkworks sorts of projects?
No, not the same thing. While there may research being done in software, general software development is not part of R&D. R&D's role is to research new methods/technologies and develop them for use in whatever product you might be working on.
Quote:
Originally Posted by malax
I've always wondered this: does "R&D" (research and DEVELOPMENT) include all the software development costs? Or is it only the more abstract/skunkworks sorts of projects?
Quote:
Originally Posted by mjtomlin
No, not the same thing. While there may research being done in software, general software development is not part of R&D. R&D's role is to research new methods/technologies and develop them for use in whatever product you might be working on.
It includes all software development, at least for financial reporting purposes.
Quote:
Originally Posted by arch
Google, Microsoft, Samsung, Intel, Nokia spend much more than Apple (not just as %).
And that's proof of how stupid they are.
There's 0 innovation from those sides, only small experiments. Apple is the one that outmuscles industries and pushes their way forward.