Apple Boosts R&D Spending To $3.4 Billion In 2012

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Apple Boosts R&D Spending To $3.4 Billion In 2012
Apple Inc. (NASDAQ:AAPL) research and development spending was up nearly 40% in 2012, as compared to the amount spent last year. However, this increase was only about 4 percentage points better than the growth registered in 2011 from 2010, although, it was huge in monetary terms. The company increased its spending in R&D by over $900 million, to around $3.4 billion during fiscal year 2012.

Apple Inc. (NASDAQ:AAPL) grew its research and development spending from $2.4 billion spent last year, to nearly $3.4 billion, representing 39.1% growth. This rate represented about 2% of net sales posted by the tech giant in full year 2012. This year’s growth was a slight improvement from the growth rate reported last year of about 36% as R&D spending grew from about $1.8 billion in 2010, to $2.4 billion.

Interestingly Apple lags behind its major rivals in the U.S. in terms of the amount spent in R&D. For instance, Microsoft Corporation (NASDAQ:MSFT) spent $9.5 billion, while search engine giant Google Inc (NASDAQ:GOOG) spent $5.2 billion.

However, this does not indicate Apple’s laxity to investing in R&D. The company’s statement in the press release said that, it 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, noted CNET News. The company also emphasized its desire to remain competitive in the business environment as a major reason it prioritizes on investing R&D.

The report also notes that one of the major investments has been put in the expansion of its Cupertino headquarters, in a project that will result in a research facility of about 300,000 square feet, scheduled for completion by the year 2015.

The company’s total capital expenditure in 2012 was $10.3 billion, while retail expenditure was pegged at $856 million. Product tooling and manufacturing accounted for a staggering $9.5 billion. Apple Inc. (NASDAQ:AAPL) expects to reduce the amount spent on capital expenditure to about $10 billion flat, representing about 3% decline, or $300 million.

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