Taps Coogan – October 15th, 2023

Over the last decade, Apple’s research and development (R&D) spending has jumped from about $3 billion to over $26 billion.

The world’s largest company, like other tech giants, is investing heavily in R&D on the heels of AI disruption and the rapid speed of innovation. As these technologies become more pervasive in our daily lives, so too has investment in R&D across major companies.

This graphic from Trendline shows the scale at which the 10 biggest companies listed on the Nasdaq are spending on R&D.

R&D Investment by the 10 Biggest Nasdaq Firms

In 2022, the 10 largest Nasdaq companies by market cap spent roughly $222 billion on R&D—a figure that has risen considerably in recent years.

Rank	Name	R&D % of Revenue	R&D Spend in 2022* (Billions)
1	Amazon	14%	$73.2
2	Alphabet	14%	$39.5
3	Meta	30%	$35.3
4	Apple	7%	$27.7
5	Microsoft	13%	$26.6
6	Nvidia	27%	$7.3
7	Broadcom	14%	$4.9
8	ASML	15%	$3.3
9	Tesla	4%	$3.1
10	PepsiCo	1%	$0.8

*Trailing 12 months, ending December 31, 2022. Nvidia and Broadcom data is as of January 29, 2023.

Amazon invested over $73 billion in R&D last year, more than double the levels seen at Meta or Apple. R&D spending increased 30% over the year for the retail heavyweight, as it invested in technology infrastructure that underlies everything from software to autonomous vehicles.

Facebook parent Meta spent almost a third of its annual revenues on R&D in 2022, the highest proportion across the 10 largest Nasdaq companies. The majority of these investments were through its research arm, Reality Labs, which is focused on building a metaverse. However, the company has since pivoted away from its work on the metaverse due to a lackluster response—instead focusing on generative AI.

Chipmaker Nvidia, which has seen its market capitalization skyrocket in 2023, spent over $7 billion on R&D across generative AI, deep learning, robotics, and a number of other research areas. Between 2021 and 2022, investments in R&D grew by 34%.

Fastest Rising R&D Spenders, Globally

Beyond big tech names in the Nasdaq, many companies are accelerating their investment in R&D as the complexity of technology increases.

The table below shows the top 10 companies globally with the highest increase in R&D spend, based on analysis by fDi Intelligence.

Rank	Name	Country	R&D Spending % Change 2021-2022
1	BYD	China	+133%
2	AMD	U.S.	+76%
3	Moderna	U.S.	+65%
4	Meta	U.S.	+43%
5	Nvidia	U.S.	+39%
6	Uber	U.S.	+36%
7	Novo Nordisk	Denmark	+35%
8	Vertex Pharmaceuticals	U.S.	+31%
9	TSMC	Taiwan	+31%
10	Amazon	U.S.	+31%

China’s largest electric vehicle maker, BYD, increased R&D investment by 133%, the most across companies analyzed. Among its primary research areas is the “Blade Battery”, which is a prismatic battery designed to hold as much as 50% more energy than comparable models.

Two chipmakers, AMD and TSMC also made the list, while three healthcare companies Moderna, Novo Nordisk, and Vertex Pharmaceuticals made significant R&D investments.

The Future of Innovation Spending

Even as many big tech names saw their stock prices fall in 2022, many dramatically increased their R&D investment.

This came as tech firms laid off thousands of employees. Together, Amazon, Microsoft, and Google’s parent company Alphabet laid off 40,000 employees as of early 2023.

Despite challenging environments, the focus on R&D is evident. Large companies can apply innovation across numerous areas of their business and improve efficiencies, with the goal of making the most out of research dollars spent.

At the same time, the complexity of technology is accelerating, requiring companies to spend more to keep with the pace of innovation. This involves investment in engineers, research facilities, along with the cost of running more advanced technological infrastructure.

Between 2000 and 2020, global R&D spending increased more than threefold to $2.4 trillion, a trend that shows minimal signs of slowing.