When I started work on this article, I was concerned that IBM management has not been making sufficient reinvestment into the business, that the dividend and buybacks were absorbing capital that could have been deployed to better purpose driving growth. After developing appropriate information on the topic, I find indications to the contrary. This article presents my findings.
R&D Spending
From the 10-Ks:
- 2015 "IBM annually invests approximately 6 percent of total revenue for R&D..."
- 2016 "IBM annually invests 6 to 7 percent of total revenue for R&D..."
- 2017 "IBM annually invests 7 to 8 percent of total revenue for R&D..."
IBM's R&D efforts reliably create a flood of patents. I'm hopeful that increased spending will focus on development, actually moving these concepts to market. The company declares flatly that they are the leader in Quantum Computing, and they actually have a working sample out there for the public to look at and experiment with.
