Apple boosts R&D spend, now 3 percent of revenue
Summary: Apple, in search of new product categories, has boosted its R&D spending 33 percent for the six months ending March 31.
Apple is increasing its research and development spending and is now at 3 percent of revenue compared to 2 percent in recent years.
The R&D spending was detailed in Apple's quarterly 10-Q filing with the Securities and Exchange Commission. As Apple's sales have ramped, the company hasn't been able to increase its R&D spending. As a result, Apple's R&D spending as a percentage of revenue was in line with what Dell and Hewlett-Packard spend.
Apple CEO Tim Cook obviously sees the discrepancy. He should since Cook was a former IBMer. IBM keeps its R&D spending at 6 percent of sales hell or high water.
Also: Apple fans face a big iWait on new product categories, services | Apple's Cook: Product launches more about 2014
Specifically, Apple spent $1.12 billion on R&D for the three months ended March 30, up from $841 million the year before. For the six months ending March 30, Apple's R&D spending is up 33 percent from a year ago. Apple's Cook had mentioned new content and services going forward. Apple also shook up its management team last year and Bob Mansfield was tasked with developing the company's chip and networking technologies.
Regarding R&D spending, Apple said:
R&D expense increased $278 million or 33% during the second quarter of 2013 compared to the second quarter of 2012 and increased $530 million or 33% during the first six months of 2013 compared to the same period in 2012. These increases were primarily due to an increase in headcount and related expenses to support expanded R&D activities.
The Company continues to believe that focused investments in R&D are critical to its future growth and competitive position in the marketplace and are directly related to timely development of new and enhanced products that are central to the Company’s core business strategy. As such, the Company expects to make further investments in R&D to remain competitive.
As a percentage of sales, Apple's R&D spending could be higher, but it is certainly a step in the right direction.
Previously: Apple's R&D spending hits bottom as percentage of revenue
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Talkback
Misleading statistics
Also, as we all know in this day and age of graft and corruption (Pentagon spending $300 on a hammer) we know that some companies spend money wisely and efficiently and some blow it.
So look at results, Apple reinvented the phone and tablet market these past few years, and I'm sure they have stuff in the pipeline just as trailblazing. While other companies blow through mor money, with less to show for it.
Look at MS, wastes billions on a touchscreen the size of a table, while Apple concentrated on putting one in your hand.
RE: MS waste
MS had a pocket PC with touch enabled that allowed users that ability to access everything in their hand long before the iphone. MS also created the tablet genre long before the ipad and nobody cared at the time. MS created zune as a ipod ripoff, when it was obvious they should have made it a phone at launch thus pre-dating the iphone. Had MS had the foresight to make the zune a phone at launch, MS may be seen differently today in the mobile space.
Why do you need a tablet that big to do this?
Shouldn't your handle be 'Realist 1899? You are so far behind the times.
Or maybe you want just a nice, quiet restaurant with your family? As soon as you sit down, you order your sodas, tea and coffee without having to wait for someone to come ask and--again--make that round trip. In fact, with your own tablet maybe you have already placed your order even before you arrived--having it acknowledged and submitted to the kitchen on your arrival. The possibilities are endless.
You are right, a realist understands the difference between fact and fiction--they don't go out of their way to imply a fiction is fact.
You are absolutely right about Microsoft being first with most tablet tech
Apple saw the failure and as Jobs himself said almost 30 years ago, "People don't know what they want until they see it." Apple made it work right and as such effectively stole the smartphone market away from the established players. Apple made it work right on tablets and flat-out stole it all away--selling more iPads in less than 9 months than all tablet PCs combined since Microsoft's first announcement in 2001.
So where do we stand with Microsoft today? Well, I believe they learned at least part of their lesson. This time they're pushing for the touch-centric apps. This time they're pushing for the touch-centric hardware. The problem is, their users are pushing back--refusing to accept change because it is 'too different'. Worse, Microsoft is giving-in to that back pressure rather than driving through with their concept--which can only end badly for both parties.
Apple has shown us the direction personal computing is going. Everyone else now has the chance to move the whole system forward.
Surface Pro
Surface Pro is not a waste. It is a great way to use a portable computer and more convenient than a oversize cell phone. Except for some physically inactive people who think the Surface Pro is to heavy. I’m sure Apple knows that tablets (real tablets) is going to be the way to go, but will wait until Intel comes up with more efficient processors that will not drain the battery.
I’m sure that is why Microsoft delayed the release of the Office suite for the iOS because how Intel & AMD are making advancements it will make more sense to purchase a tablet than a oversize cell phone.
real tablets
Should it have rounded corners, or should it not? Should it have active stylus input, or should it not? Should it have attached keyboard, or should it not? Should it run a "real" OS or should it not. By the way, is there any "unreal OS" out there? Should it do "real work" or should it not? By same measure, is there "unreal work"?
etc, etc....
You see, it all makes no sense. You either have a product that people want, in an tablet form factor, like the iPad. Or you have an product in tablet form that people mostly skip, like the Surface. This is "real".