Recent Spike In Apple Inc. (NASDAQ:AAPL)’s Research Budget Suggests New Products May Be In Store

AAPL Stock News

Apple Inc. (NASDAQ:AAPL) fans have a new reason to cheer. The iPhone manufacturer might be on the verge of unveiling new products as a spike has been observed in Apple’s Research and Development (R&D) budget recently. Such surges were observed previously when Apple was about to launch the iPod, iPhone and iPad. Hence, analysts speculate that Apple is about to enter a new product category in the near future.

Recent Spike In Apple Inc. (NASDAQ:AAPL)’s Research Budget Suggests New Products May Be In Store

According to reports, Apple Inc. (NASDAQ:AAPL) has spent about $1.6 billion for R&D during the third quarter of this year. A Morgan Stanley report claimed that this amount is 36 % higher than the figures obtained during the same time last year. The report also stated that if this spending trend continues, Apple’s year on year R&D expenditure would have increased by 60% by the fourth quarter.

Apple Inc. (NASDAQ:AAPL)’s phenomenal devices

The last time Apple Inc. (NASDAQ:AAPL) came out with a brand new product category was four years back with its iconic iPad. The company has been the pioneer in the field of creating new and one of kind products which have always been trendsetters of their age. The number of imitations and rip offs that Apple’s products have ‘inspired’ over the years stands testimony to this fact. As the access to the internal working of Apple’s labs is limited, analysts can only speculate if the hike indicates the finishing touches of an existing product or the starting phase of a new one.

Increased spending might not always mean new product

While Apple Inc. (NASDAQ:AAPL) has been continually innovating its existing line of products, the cost of R & D has never before escalated to levels that are noticed currently. But some analysts feel that this change need not necessarily foreshadow an imminent product launch. Even with the current increase, Apple’s R & D spending is average when compared to other companies such as Microsoft Corporation (NASDAQ:MSFT). While the industry average for R&D spending is 6.5% of revenue, Microsoft spends about double the value whereas Apple’s expenditure comes to only 4% of its revenue.

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