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Apple R&D spending is up as the company looks to new products

ICE Graveyard 26/07/2016 Brian Heater

The big takeaway from today’s Apple earnings call: the company is investing in the future. While it’s true that revenue took a dip from $49.61 billion this quarter last year down to $42.4 billion, Cupertino’s research and development spending continues to trend upward.

Over the past nine months, the company spent $7.475 billion on R&D – that compares to $5.847 billion over the same time period the previous year. And it’s part of a continued trend in the face of lowered revenues that points to a company looking to break out of a stagnation in innovation that has largely seen iteration on existing product categories over the last several years. Apple is spending more of its total revenue on research and development than it has in some years, pointing to a company that looking to shake things up once again.

Asked about the Apple’s investment in third-parties like Chinese Uber-style car service Didi Chuxing, CEO Tim Cook explained that while that trend will likely continue, the bulk of the company’s investment has been and will remain in its own internal development. “We invest a ton of capital in our business itself to support research and development,” he said on the earnings call. “That’s the main source of our investment.”

He added that the billion dollar Didi Chuxing investment, while unusual, would help give the company added perspective on the Chinese market. As far as what Apple’s actually developing in-house, Cook hinted at a future lined with new devices.

“There’s quite a bit of investment in products that are not currently shipping,” he added during the call. Cook, naturally, wouldn’t list any specific new products or categories for the company, but it goes without saying that it takes a lot to, say, build a new car. Just ask Bob Mansfield.

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