Amazon spent ~$68B on R&D
Comparing R&D expense across Big Tech
Thanks for subscribing to Trendline.
Today, we are looking at the ginormous amount of money spent on research & development (R&D) by the Big Tech companies.
But first, what kinds of costs are classified as “R&D”
Tech is a very competitive industry, and often, these costs are essential for companies to find their next breakthrough revenue source (e.g. AWS for Amazon,= or the iPhone)
Take a look at the visual below:
R&D spent by Big Tech
These 5 companies, spent a total of $190 billion in last 12 months on R&D.
Couple of interesting observations from the chart above:
Amazon spends more money on R&D, than Google and Apple combined. I was shocked to see this! However, Amazon is known to place a lot of new bets and this costs reflect that.
Meta is investing heavily in R&D, relative to its size. While it has always been a big spender on R&D, this has ramped up recently with its pivot into the Metaverse
A big question for investors to answer is if these high costs are justified and if (or when) will they bear fruit in finding new growth avenues for companies.