“History is replete with examples of technology companies that once generated vast sums of revenue and profit, only to either cease to exist or become shadows of their former selves,” Ashraf Eassa writes for The Motley Fool. “Sometimes, these companies were disrupted by smarter, more agile competitors that changed the rules of the game, and in other cases, poor management simply couldn’t keep the momentum going.”
“One way that Apple tries to avoid such a fate is by investing heavily in research and development,” Eassa writes. “Last quarter, the company once again increased these investments.”
“During Apple’s most recent quarter — that’s the second quarter of Apple’s fiscal 2018 — Apple spent $3.378 billion on research and development expenses. This represented an eye-popping 21.7% year-over-year increase. During the first half of fiscal 2018, Apple’s research and development spending was up 20.1%, so the rate of growth actually accelerated a bit during the second quarter compared to the first,” Eassa writes. ” Apple needs to be working on next-generation product categories. They can be smaller deals, like new accessories (e.g., AirPods, HomePod), or they can be much bigger deals, like the Apple Watch. Not every one of these new categories is going to be a smash hit in the mold of the iPhone, but if Apple can regularly bring out reasonably successful new categories and invest heavily in them, the aggregate revenue from these categories should become quite substantial.”
Read more in the full article here.
MacDailyNews Take: May Apple’s investments bear much fruit!
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