The R&D World Index (RDWI) for the week ending May 10, 2024, closed at 3,563.72 for the 25 companies in the RDWI. The Index was up 1.51% (or 52.86 basis points).

Eighteen RDWI members gained value last week from 0.18% (Stellantis NV) to 5.34% (Meta Platforms). Seven RDWI members lost value the previous week from -0.17% (Apple) to -6.05% (Toyota).

RDW Index member Honda Motor Company, Tokyo, announced last week that it will increase its R&D spending in this financial year by nearly a quarter to boost its competitive edge in hybrid and other electric vehicles (EVs). Toyota plans to invest $7.6 billion in R&D in 2024, up 23% from 2023. The company plans to produce 2 million hybrid EVs a year by 2030. Honda plans to build an EV production base in Ontario, Canada, and launch six EV models in China by 2027. Many other carmakers are now focusing more on hybrid EVs as sales of fully EVs disappoint. South Korea’s Hyundai Motor Company, Seoul, also said last week that it plans to use investments already lined up for the U.S. to build hybrid vehicles at its EV plant in Savannah, Georgia.

Developer of semiconductor manufacturing equipment, Tokyo Electron Ltd., Japan, announced last week that it plans to invest a record $1.6 billion in R&D this year, as demand recovers for equipment used at the front end of logic and memory chipmaking. These front-end machines, which form circuits onto silicon wafers are expected to clock double-digit growth in 2025, helped especially by AI-linked server demand. Rising global demand for front-end gear will lower Tokyo Electron’s reliance on China, now at 44%, to less than 40% starting in 2025.

Advanced Micro Devices (AMD), Santa Clara, California, announced last week that its R&D investments have quadrupled from $1.5 billion in 2019 to $5.9 billion in 2023, aligning with growing computing performance and efficiency demands. Analysts note strong demand for AI and significant potential in AMD’s data center GPU (graphic processing unit) growth despite competition from Nvidia. They also emphasized strong demand for AMD’s server business which continues to improve despite headwinds.

RDW Index member Microsoft, Redmond, Washington, announced last week that it is investing $3.3 billion in a new AI data center in Sturtevant, Wisconsin. Microsoft said the project will initially create 2,300 construction jobs and as many as 2,000 data center jobs. The company is also investing in a new AI lab at the University of Wisconsin, Milwaukee campus to train workers to use AI technologies. The Sturtevant data center will be located between Milwaukee and the Wisconsin-Illinois border. Microsoft president Brad Smith grew up about 3 miles from the Sturtevant site. Microsoft has also announced plans to invest about $3.4 billion toward AI and infrastructure projects in Germany, $2.9 billion in Japan, $3.2 billion in Malaysia, and $1.6 billion into the UAE-based AI company G42.

Amazon.com announced last week that it will invest $9 billion to expand its cloud services in Singapore while global tech companies boost their data center footprints in Asia amid a demand boom for AI computing services. Amazon’s investment in its Singapore cloud infrastructure will occur through 2028 and add to the $8.5 billion already recently invested. Since the beginning of 2024, Amazon has unveiled plans to invest $15 billion in Japan and more than $5 billion each in Mexico and Saudi Arabia. The company also plans to spend nearly $13 billion by 2030 to expand its data center infrastructure in India. Amazon said its first-quarter $14 billion capital investment will be the low point for the year as it ramps up spending on AWS (Amazon Web Services) infrastructure and generative AI investments. Microsoft also stated that it would invest $4 billion into cloud computing and AI infrastructure in Malaysia and Indonesia and build its first data center in Thailand.

OpenAI, San Francisco, last week introduced a new detection tool that reveals whether an image was created using the company’s text-to-image generator, DALL-E 3. The company said the tool is highly accurate in detecting these images. But small changes to a picture can confuse it, reflecting how AI companies are playing catch-up in the ability to track their technologies. Policymakers are increasingly encountering AI-created images online. DALL-E 3 makes it possible to create this type of content even faster.

U.S. spy agencies, including the CIA and the NSA, issued directives last week limiting how they buy and use troves of data on Americans gleaned from thousands of smartphone apps and other personal devices such as cars and internet-connected household appliances. The directives do not mandate that these spy agencies obtain a warrant before purchasing or searching the data, a rule sought by some lawmakers. The new directives establish rules for collecting and analyzing commercially available data on foreigners and Americans but grant each agency “flexibility to experiment” in how they use the data. Anyone can purchase this information, including overseas individuals. The spy agencies are ensuring the data is being used lawfully and observing privacy protections while relying on it to help more quickly identify threats.

 

R&D World’s R&D Index is a weekly stock market summary of the top international companies involved in R&D. The top 25 industrial R&D spenders in 2020 were selected based on the latest listings from Schonfeld & Associates’ June 2020 R&D Ratios & Budgets. These 25 companies include pharmaceutical (10 companies), automotive (6 companies), and ICT (9 companies) which invested a cumulative total of nearly 260 billion dollars in R&D in 2019, or approximately 10% of all the R&D spending in the world by government, industries and academia combined, according to R&D World’s 2021 Global R&D Funding Forecast. The stock prices used in the R&D World Index are tabulated from NASDAQ. NYSE, and OTC common stock prices for the companies selected at the close of stock trading business on the Friday preceding the online publication of the R&D World Index.