The R&D Index for the week ending November 9, 2018 closed at 4,376.71 for the 25 companies in the R&D Index. The Index was up 1.95% (or 83.85 basis points) from the week ending November 2, 2018. The stock of twenty R&D Index companies gained value last week from 0.25% (Honda) to 8.24% (Astra Zeneca). The stock of five R&D Index companies lost value last week from -0.92% (General Motors) to -10.44% (Qualcomm).
The Federal Reserve held its regularly scheduled November meeting last week with no changes made in interest rates. It continued its confidence in the U.S. economy, implying that its plan for a fourth interest rate hike for 2018 is still likely to occur at its December meeting.
R&D Index member Qualcomm was the big market loser of the R&D Index members last week, with its stock falling by 10.4% for the week. While ahead of analysts’ projections, Q3 revenues for Qualcomm announced last week were still 20% below its 2017 Q3 values. The smartphone component supplier is suffering from a global slowdown in smartphone sales and its continuing legal battle with Apple which has shut out Qualcomm from the latest iPhone product releases. As its revenues fall, Qualcomm’s R&D spending is similarly falling from $5.2 billion in 2018 to less than $5.0 billion expected in 2019.
R&D Index member Amazon announced last week that it had created an arrangement with Advanced Micro Devices (AMD) that allows customers of Amazon Web Services (AWS) to choose services that use AMD’s processors. AMD already has similar relationships with Microsoft, Oracle, Baidu and Tencent. The Amazon-AMD deal allows AMD to possibly gain cloud server market share on Intel, especially since Amazon is the undisputed market leader in the public cloud industry. Analysts expect AMD to have 17% market share for server chips by 2021 compared to the less than 5% they now have. AMD currently spends $1.3 billion on R&D (2018) and is expected to spend $1.4 billion in 2019.
Canadian aerospace firm Bombardier announced last week that it would cut another 5,000 jobs and sell off its pilot training and turboprop businesses. Its CSeries aircraft business was sold to Airbus earlier this year. Bombardier spent $212 million on R&D in 2018 and was expected to spend $177 million on R&D in 2019 before the current divestitures
| R&D Index Week Ending November 9, 2018 |
| Ticker | Exchange | 2018 R&D millions U.S. $ | 11/02/18 | 11/09/18 | 11/09/18 to 11/2/18 | 11/09/18 to 12/29/17 | |
| Amazon | AMZN | NASDAQ | 26,750 | 1,665.53 | 1,712.43 | 2.82% | 46.43% |
| Alphabet/Google | GOOGL | NASDAQ | 18,796 | 1,071.49 | 1,077.02 | 0.52% | 2.24% |
| Apple | AAPL | NASDAQ | 14,037 | 207.48 | 204.47 | -1.45% | 20.82% |
| Intel | INTC | NASDAQ | 13,702 | 47.11 | 48.11 | 2.12% | 4.22% |
| Microsoft | MSFT | NASDAQ | 13,558 | 106.16 | 109.57 | 3.21% | 28.09% |
| Roche Pharm | RHHBY | OTC | 12,284 | 29.82 | 31.30 | 4.96% | -0.89% |
| Johnson & Johnson | JNJ | NYSE | 11,493 | 140.68 | 145.34 | 3.31% | 4.02% |
| Merck & Co. | MRK | NYSE | 11,323 | 72.27 | 74.86 | 3.58% | 33.04% |
| Volkswagen AG | VWAGY | OTC | 10,915 | 17.20 | 16.19 | -5.87% | -59.97% |
| Toyota | TM | NYSE | 10,848 | 115.46 | 117.24 | 1.54% | -7.81% |
| Novartis | NVS | NYSE | 8,934 | 87.20 | 89.22 | 2.32% | 6.26% |
| Honda | HMC | NYSE | 8,180 | 28.43 | 28.50 | 0.25% | -16.37% |
| Pfizer | PFE | NYSE | 7,942 | 42.93 | 44.28 | 3.14% | 22.25% |
| Daimler | DDAIY | OTC | 7,615 | 53.46 | 50.86 | -4.86% | -39.85% |
| General Motors | GM | NYSE | 7,278 | 36.03 | 35.70 | -0.92% | -12.91% |
| Oracle | ORCL | NYSE | 7,001 | 48.83 | 50.61 | 3.65% | 7.04% |
| Bristol-Myers Squibb | BMY | NYSE | 6,981 | 50.69 | 53.39 | 5.33% | -12.88% |
| Eli Lilly Co | LLY | NYSE | 6,769 | 106.75 | 112.21 | 5.11% | 32.86% |
| GlaxoSmithKline | GSK | NYSE | 6,394 | 38.84 | 41.30 | 6.33% | 16.44% |
| Cisco | CSCO | NASDAQ | 6,009 | 45.48 | 47.11 | 3.58% | 23.00% |
| IBM | IBM | NYSE | 5,842 | 115.67 | 123.54 | 6.80% | -19.48% |
| Bayer AG | BAYN | OTC | 5,743 | 20.01 | 20.18 | 0.85% | -35.09% |
| Astra Zeneca PLC | AZN | NYSE | 5,483 | 37.85 | 40.97 | 8.24% | 18.07% |
| Qualcomm | QCOM | NASDAQ | 5,183 | 63.33 | 56.72 | -10.44% | -11.40% |
| Sanofi SA | SNY | NYSE | 4,694 | 44.16 | 45.59 | 3.24% | 6.02% |
| Total | 243,754 | 4,292.86 | 4,376.71 | 1.95% | 15.43% | ||
| Biopharmaceutical | 671.20 | 698.64 | 4.09% | 9.55% | |||
| Automotive | 250.58 | 248.39 | -0.87% | -24.03% | |||
| ICT | 1,705.55 | 1,717.15 | 0.68% | 3.61% | |||
About the R&D Index
R&D Magazine’s R&D Index is a weekly stock market summary of the top international companies involved in research and development. The top 25 industrial spenders of R&D in 2017 were selected based on the latest listings from Schonfeld & Associates’ June 2018 R&D Ratios & Budgets. These 25 companies include pharmaceutical (11 companies), automotive (5), ICT (8) and conglomerate (1) organizations who invested a cumulative total of more than $209 billion in R&D in 2017, or approximately 10% of all the R&D spent in the world by government, industries and academia combined, according to R&D Magazine’s 2018 Global R&D Funding Forecast. The stock prices used in the R&D Index are tabulated from NASDAQ, NYSE, XETRA and OTC common stock prices (in U.S. dollars) for the companies selected at the close of stock trading business on the Friday preceding the publication of the R&D Index in R&D Magazine’s R&D Daily eNewslette
