Samsung is No. 1 in world for R&D spending

Samsung Electronics was the No. 1 investor in R&D in the world this year, according a report from the European Commission.

The annual R&D Investment Scoreboard report released by the commission analyzes R&D indicators of top companies in the world, based on their most recent accounts and annual reports. The 2018 report studied 2,500 companies worldwide from 46 countries.

Samsung Electronics invested a total of 13.44 billion euros ($15.2 billion) in R&D this year, an 11.5 percent year-on-year increase compared to last year’s report, when it took third place on the list. This is the first time a Korean company has come in first since the European Commission first published the report in 2004.

Tailing Samsung in second place was Alphabet, Google’s holding company. It spent a total of 13.39 billion euros. Volkswagen was ranked third at 13.14 billion euros. The list went on to include Microsoft, Huawei, Intel and Apple, all having spent between 9.7 billion and 12.3 billion euros.

Samsung was the only Korean company within the top 50 R&D spenders worldwide. However, the report showed that, in terms of the ratio of R&D investment to sales - which the report dubbed “R&D intensity” - Samsung fell behind other major companies higher up the list.

The local company’s R&D intensity was 7.2 percent - lower than second rank Alphabet’s 14.5 percent and Chinese IT company Huawei’s 14.7 percent. It was slightly higher than Apple, however, which had a ratio of 5.1 percent.

The report also showed that, apart from Samsung, Korea was falling behind in R&D investment compared to neighboring countries Japan and China.

The 2,500 companies studied for the report had invested a combined 736.4 billion euros, with 14 percent of that total coming from Japan-based companies and 10 percent from China. The top contributors were the United States at 37 percent and the European Union at 27 percent.

A total of 70 companies from Korea were included in the study. LG Electronics was the only other one mentioned by name, coming in third place in the “Top 3 companies by R&D for the main industries: Other” category after Japan’s Panasonic and Sony.

BY SONG KYOUNG-SON [song.kyoungson@joongang.co.kr]