STMicroelectronics is the third largest spender on R&D in the semiconductor industry and has the second highest ratio of R&D spend to sales revenue among the major players,reports IC Insights.
ST came third after Intel and Samsung in total R&D spend last year with a$2.4bn expenditure on R&D,which only$400m lower than the R&D spend of Samsung which has three times the revenues of ST.
ST's R&D spend to revenues ratio of 24%is second only to Broadcom's ratio of 28%.
In absolute spend terms,Intel has the highest at$8.4bn,followed by Samsung on$2.8bn and ST on$2.4bn.
After them come:Renesas($2.1bn);Qualcomm,Toshiba and Broadcom(each on around$2bn),TI($1.7bn),AMD($1.5bn)and TSMC($1.2bn).
In terms of R&D-to-sales ration,Broadcom was top at 28%,followed by ST on 24%,AMD on 22%,Qualcomm on 21%,Renesas on 17%,Toshiba on 16%,TI on 13%,and Samsung and TSMC both on 8%.
Worldwide spending by on R&D by semiconductor companies is expected to grow 10%in 2012 to$53.4bn compared to$48.7bn set in 2011.
The increase will lift R&D spending by chip companies to 16.2%of total semiconductor sales in 2012,which are now forecast to rise 3%to$329.8bn from revenues of$321.4bn in 2011.
A dozen semiconductor companies spent more than$1.0 billion each on R&D in 2011 for the first time ever.
Intel's R&D expenditures accounted for 32%of the top-10 spending and about 17%of total R&D expenses at all semiconductor companies worldwide counting integrated device manufacturers(IDMs),fabless suppliers,and foundries.
Intel's 27%increase in R&D expenditures was the largest among companies spending$1bn or more on R&D last year.Fifth-ranked Qualcomm,the industry's largest fabless semiconductor supplier,increased its R&D spending by 25%in 2011,while TSMC grew R&D spend by 23%.
For more than three decades,R&D spending as a percentage of total semiconductor sales has zigzagged higher due to increasing costs in developing more complex IC designs and the creation of next-generation process technologies for large-diameter wafers(currently 300mm but heading toward 450mm later this decade).
R&D spending as a percent of semiconductor sales by chip companies was typically 7-8%in the late 1970s and early 1980s.R&D-to-sales ratios grew to 10-12%of revenues by the early 1990s and then jumped to over 15%during the last decade,reaching a record 17.5%in 2008.
US companies accounted for 57%of worldwide semiconductor R&D spending in 2011,followed by suppliers based in Japan,17%;Europe,10%;Taiwan,8%;South Korea,7%;and mainland China,1%.
IDMs accounted for about 66%of R&D spending by semiconductor companies in 2011,while fabless suppliers represented 29%,and pure-play foundries made up the remaining 5%of the total.
TSMC,which entered the top-10 R&D ranking in 2010 for the first time ever,increased its R&D spending by 23%,nearly double the 12%average growth recorded by the top 10 last year.
With the influx of IDMs turning to foundry capacity and major fabless customers needing lead-edge CMOS processes,TSMC is spending more money on both new 300mm fabs and R&D.
In July 2012,TSMC chief executive Morris Chang noted that his company's 2012 R&D budget is now double the amount spent in 2009(which was$656m),in addition to raising capital expenditures 13%to an all-time high of$8.25bn compared to$7.33bn in 2011.
TSMC's R&D-to-sales ratio stood slightly above 8%in 1H12 versus 7.9%in 2011,5.1%in 2005 and 3.1%in 2000.
