Apple spent more money on research and development in the past quarter than it spent in any three month period its entire history. It was also the largest proportion of its revenue since 2003, back when the iPod was Apple’s biggest seller.
At a time when the iPhone no longer accounts for most of Apple’s revenue, it suggests that there are some big things in the works.
In total, Apple spent $4.2 billion on R&D in the quarter ending June. This was 7.9% of Apple’s total revenue, putting Apple on pace to spend $16 billion+ on R&D this year.
The great pipeline of products
R&D spending by itself doesn’t mean anything, of course. Apple has long been outspent by some of its biggest tech rivals. In the last quarter, Microsoft and Google both invested a greater percentage of their revenue than Apple did. This is similar to Apple’s approach to buying companies, where despite its deep pockets, it’s never splashed cash in quite the same way as other giants. But Apple has nonetheless historically shown that it can dictate the direction of the industry with its investments.
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