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Analyzing 3Q15 R&D Expenditure for Broadcom, Micron, and Linear

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Broadcom’s R&D expense fell as a percentage of revenues in 3Q15

In 3Q15, Broadcom’s (BRCM) expenses in research and development (or R&D) fell to $542 million from $573 million in 3Q14 and $609 million in 3Q13. R&D expenses comprised 24.8% of total revenues in 3Q15. In comparison, expenses comprised 28.4% and 25.4% of total revenues in 3Q13 and 3Q14, respectively.

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Micron’s R&D expense in 3Q15

In 3Q15, Micron’s (MU) R&D expenses rose YoY (year-over-year) to $379 million from $358 million in 3Q14 and rose in comparison to R&D expense of $267 million in 3Q13. R&D expenses comprised 10.5% of total revenues in 3Q15. In comparison, expenses comprised 7.3% and 8.5% of total revenues in 3Q13 and 3Q14, respectively.

Linear Technology’s R&D expense was constant in 3Q15

In 3Q15, expenses for Linear Technology (LLTC) in research and development (or R&D) have risen to $67 million from $66 million in 3Q14 and from $62 million in 3Q13. R&D expenses comprised 19.6% of total revenues in 3Q15. In comparison, these expenses comprised 18.2% and 17.8% of total revenues in 3Q13 and 3Q14, respectively.

Research and development is an important component of the semiconductor sector. All firms invest heavily in research and development in order to innovate and introduce a new range of products to customers on a regular basis.

Broadcom accounts for 0.76% of the Technology Select Sector SPDR ETF (XLK) and 5.1% of the VanEck Vectors Semiconductor ETF (SMH).

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