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Amazon’s Spending on Research and Development Keeps Growing

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Amazon spent $22.6 billion on R&D in 2017

Tech (technology) giant Amazon (AMZN) spent more money on research and development (or R&D) in 2017 than any other American company. It entered into a number of new industries in 2017 and spent a whopping $22.6 billion on R&D, according to FactSet and reported by Recode. That compares to $16.1 billion in 2016.

Amazon has invested heavily in its fastest-growing segments, AWS (Amazon Web Services) and Alexa, its digital assistant.

Google parent Alphabet (GOOGL), Intel (INTC), Microsoft (MSFT), and Apple were the other top US companies in terms of R&D spending in 2017.

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Amazon’s R&D spending is growing faster than its close rivals

Amazon’s R&D expenses rose at a much greater pace than its peers. Facebook (FB) was in the ninth spot overall and sixth among tech stocks, with R&D spending of $7.8 billion in 2017. That’s a 32% rise from the previous year.

Amazon’s hunger for growth, as suggested by its increasing R&D expenses, could be the reason the stock has become an investor darling. The stock surged more than 55% last year and more than 20% year-to-date, despite the recent market turmoil. The company has a track record of reinvesting its profits in new segments.

Amazon will soon build a second headquarters the same size of the one in Seattle. It has narrowed down its list of possible cities in North America to 20.

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