R&D spending dominated by U.S. chip manufacturers

31 August 2022 News

American companies continue to account for more than half of the global chip industry’s total spending on research and development, according to the latest annual analysis of R&D; expenditures by IC Insights. Almost 56% of global semiconductor industry R&D; spending in 2021 was by companies headquartered in the U.S. with the largest single spender being Intel at 19% or $15,2 billion.

Figure 1 shows semiconductor R&D; expenditures by Asian-Pacific companies which includes wafer foundries, fabless chip suppliers, and integrated device manufacturers (idms), came a distant second place by exceeding just 29% of the worldwide total in 2021, followed by those based in Europe at about 8%, and Japan at nearly 7% of industry spending. The graphic shows that while R7D spending in the Americas has not increased much between 2011 and 2021, the biggest jump was by the Asia-Pacific region which saw an increase of 11,5%. This increase largely came on the back of the major decrease in spending by both the Europe- and Japan-based companies.

According to IC Insights’ 2Q22 update of the McClean Report, semiconductor companies worldwide spent 13,1% of combined sales on R&D; in 2021 ($80,5 billion) versus 15,5% ($50,8 billion) in 2011. In terms of R&D; expenditures as a percent of semiconductor sales, companies headquartered in the Americas region had the largest ratio at 16,9% in 2021. Next were European companies who spent about 14,4% of their combined chip revenues on R&D, the Japanese region spent 11,5% of sales, and the Asia-Pacific region brought up the rear with a total spend ratio of only 9,8% of sales for 2021.

Semiconductor companies based in Taiwan which includes wafer foundries, like Taiwan Semiconductor Manufacturing Co, accounted for 14,4% of the industry’s total R&D; expenditures in 2021 (about $11,7 billion). IC Insights’ also reports that South Korean suppliers which include Samsung represented 11,9% ($9,9 billion) of global semiconductor R&D; spending.

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