“One of the hallmarks of Silicon Valley companies is that they tend to increase their research and development (R&D) budget during tough times, not shrink them,” Tim Bajarin writes for TIME Magazine.
“Facing a slowdown in iPhone sales and other tribulations, Apple is on track to spend $10 billion on R&D this year, a 30% increase from 2015,” Bajarin writes. “…What spooked Wall Street is that it’s clear that Apple’s iPhone sales trajectory has leveled out. Sales of iPhones during the last quarter were only about 54 million, compared to over 70 million in the same quarter a year before. Investors, who panic if they don’t see growth, have penalized Apple’s stock in a big way for the slowdown.”
“Still, some financial analysts still see Apple as a good bet. Many have have a ‘buy’ recommendation on the firm, even after factoring in lower iPhone sales levels as the new normal.,” Bajarin writes. “That said, this major increase in R&D spending is significant. It suggests that Apple has more new products in the research labs that likely go beyond its current lineup… So what could Apple be working on? Here are a few ideas.”
Read more in the full article here.
MacDailyNews Take: As Apple CEO Tim Cook said on April 26th:
The future of Apple is very bright. Our product pipeline has amazing innovations in store. We’re very excited about bringing together developers for our four major platforms at our Worldwide Developers Conference in June. We are forging ahead with important investments in research and development, in our infrastructure, and in our supply chain… We’re very excited about what’s in our pipeline.