Samsung has had a rough year thanks to the Galaxy Note 7, fortunately for the company though, it is expected to show strong profit margins starting next year. Even though the Note 7 did cost Samsung over $3 billion in losses, it didn’t create as big of an impact for the company as it would have for any other hardware company, thanks mainly to Samsung’s leadership in virtually every segment of the electronics industry.
Such leadership however, doesn’t come cheap.
Global strategy consulting firm Strategy&, a part of PricewaterhouseCoopers, has released a list that details how much the top 20 publicly traded companies have invested in R&D. Samsung’s spending appears to have slightly increased in 2015 and Samsung Electronics, after German auto maker Volkswagen, has the largest R&D budget. It could be even higher, perhaps higher than Volkswagen even, if we consider the entire expenditure of the Samsung conglomerate.
The electronics juggernaut poured a staggering $14.1 billion in research and development of new technologies last year, just shy of Volkswagen’s $15.3 billion. The company is trying to diversify away from what was its bread-and-butter profit generator until recently, smartphones, and now they contribute for barely a third of its earnings, with the rest coming from chips, TVs, and the like.
Samsung’s biggest rival Apple spent $6 billion in comparison, which may seem small but is a record for the Cupertino giant. This might be a result of the rumoured Apple car. Both Microsoft and Google, the other two American tech giants ranked 4th and 6th respectively followed by Amazon which captured the 7th spot.
It should go without saying that R&D investment is hugely important to consumers. All the flashy features we take for granted today – Quad HD OLED screens, 10nm processors, VR, etc. – were made possible by the hundreds of billions that Samsung and its peers poured into R&D over the past decade.
Samsung takes advertising just as seriously, and it spent a total of $3.3 billion on ads alone. This combination helps ensure Samsung has some of the best hardware, and the best reach to sell it. No wonder Samsung’s competitors find it hard to compete.
Via : Sammobile