Intel’s total revenue for the past year reached $ 77.9 billion, with a net profit amount exceeding $ 20.9 billion. This means that Intel’s investment in research and development during 2020 represented 17.4% of their total income, but more shocking is to see that they invested nothing more and nothing less than 64.9% of their profits. Is this not enough?
Intel’s investment in R&D, not paying off?
If we take a look at history from 2004 to the present, Intel’s research and development investment has always been on an upward trend as a whole, only slightly declining between 2007 and 2009 and again in 2019, times when revenue went down for the company. The fastest growth occurred between 2010 and 2012, with a rate approaching 27%.
Those familiar with the company’s history will know that this was also the time when Intel Core was born, when processor performance soared and Intel managed to crush competition from AMD.
In the years since then until now, Intel’s annual growth in R&D investment has basically not exceeded 5%, and in fact if you look at it, it has been more or less in line with the performance improvements of the signature processors.
Actually, the amount of money that Intel invests in development and innovation is enormous, one of the highest in the industry if not the most, and even so in recent years we have only been able to see how AMD has been gaining ground little by little. but at a steady pace, with Ryzen processors as a clear turning point. This makes us think about the efficiency or rather the effectiveness of the money that Intel invests, because of course with such an injection of money, a much better result than they are presenting every year would be expected.
How much does AMD invest in R&D?
2019 was probably one of the most satisfying in AMD’s history, and 2020 was almost even better. Research and development is a lifeblood for every technology company, and while Ryzen and RDNA were developed with tight budgets, AMD knows that it must invest where it is needed if it is to continue its success.
In the first quarter of 2020, AMD’s R&D spending increased by more than $ 45 million from its spending of $ 395 million in the fourth quarter of 2019, representing an investment increase of 11.8%. If we compare it with spending during the first quarter of the previous year we see that AMD invested 18.5% more, a change with which they hope to make a big difference in the future developments of the company.
AMD’s primary concern at the moment is ensuring its success continues into the coming quarters, which means that the company cannot allow its R&D efforts to lag behind. AMD needs a solid hardware roadmap to continue competing with Intel and NVIDIA, both of which have greater investment capacity than AMD, and that means the company can’t keep its foot down. They have very strong patents and constant generational upgrades will help AMD continue its positive growth, but as its CPUs and GPUs become more complex, more and more effort will be required to continue to boost performance.
In other words, AMD invests much less money than Intel in R&D but even so, proportionally, they have increased their investment much more and the results they are obtaining for now are very good, with a much greater efficiency than Intel.