In 2015, 94% of the one thousand public firms globally that spend the most on R&D invested in R&D activities abroad. Their spending on these programs totaled $680 billion, up 5.1%, but revenues fell 1% due to the drop in oil prices. R&D intensity grew 0.2 percentage points to 3.7%. Asia is now the top location for R&D spending, followed by North America and Europe, with 35%, 33% and 28% of spending by the top 207 companies, respectively. Asia was the only region of the three in which the majority, 52%, of R&D spending was imported, or from companies with headquarters outside the region. Second only to the US’s corporate R&D spending of $145 billion, China experienced a rise in R&D spending to $55 billion, with $44 billion of it imported R&D. Companies with most of their R&D spending abroad performed better than less globalized companies. For example, in 2015, firms spending 60% or more outside of their headquarters’ country experienced 20% more growth in operating income, and a 30% premium on operating margin and return on assets.

Source: Strategy&