R&D spending by the one thousand public companies that spend the most on R&D increased 5.7% last year to $532 billion, as operating profits declined 8.6% and sales grew 6.5%, according to the Booz & Company’s “Global Innovation 1000” report. R&D as a percentage of sales was flat at 3.6%. R&D spending by these companies represented 50.4% of the $1,055 billion in R&D spending worldwide by industry and government. The computing and electronics, health care and automobile industries accounted for 28%, 23% and 16% of the spending. R&D spending by North American, European and Japanese firms rose 6.5%, 6.3% and 0.5%, respectively. At the top 100 firm, R&D spending increased 3.9%, but capital expenditures fell 1.0%. Of the 290 executives at 230 companies surveyed, 38% said they plan to expand R&D this year, while 35% plan to maintain it at the same level. R&D trends include: focusing more on product development and engineering and less on basic and applied research; making R&D more efficient; and being more risk averse.

Source: Booz & Company