Business models
Research & development (R&D)
Spending on inventing and improving products, from new drugs to new chip machines.
R&D is an operating cost today that is meant to produce revenue in the future. In pharma, semiconductors and software, it is often one of the largest cost lines.
High R&D spending can deepen a company's lead, but only if the research succeeds. That is why it appears both as a strength and as a risk in many breakdowns.
General explanation for education only, not investment advice. Company-specific definitions can differ; each breakdown uses the company’s own.