Samsung Invested A Record $4.38 Billion In R&D In Q1 2020

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Samsung invested a record 5.36 trillion won (roughly $4.38 billion) in research and development (R&D) activities during the first quarter this year. This is an all-time quarterly high for the South Korean company, surpassing the previous R&D investment record of 5.32 trillion won set in the fourth quarter of 2018.

The figure for Q1 2020 amounts to 9.7 percent of Samsung's total sales revenue for the quarter ending March 2020. The company had invested 9.6 percent of its sales revenue in R&D activities in Q1 2019. In total, Samsung spent 20.19 trillion won ($16.47 billion) in research and development last year.

It was the first time that Samsung's yearly R&D investment exceeded 20 trillion won. The company is likely to reach that figure this year as well.

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Samsung's business wasn't affected much by the COVID-19 pandemic in the first quarter of this year. However, things started getting worse for the company in April, so second-quarter results may not be as impressive.

In its quarterly financial results last week, Samsung announced that its total revenue for Q1 2020 stood at 55.33 trillion won. The company saw a 5.6 percent year-on-year (YoY) rise in revenue from Q1 2019. Its operating profit also increased by 0.2 trillion to 6.45 trillion won in the quarter ending March 2020.

Those figures, however, do not look as impressive when compared to its Q4 2019 results. Samsung's sales revenue dropped 7.6 percent quarter-on-quarter (QoQ) while operating profit saw a QoQ decline of 0.7 trillion won.

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The company attributed this decline to weak seasonality for display and consumer electronics businesses. The global health crisis caused by the COVID-19 pandemic might have also slightly affected Samsung's business. It remains to be seen how the pandemic affects the South Korean company's Q2 2020 business.

Samsung to continue R&D investment

During its first-quarter earnings call, Samsung announced that it would continue its investment in R&D activities as planned, despite the ongoing COVID-19 pandemic.

The company currently holds more than 180,000 patents around the world. It holds 5,075 patents in South Korea and 8,729 patents in the US. Samsung also has the highest number of 5G patents in the world.

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Going forward, the South Korean giant plans to invest heavily in the development of 5G, advanced semiconductor processes, QD-OLED screens, and many other areas.

Samsung plans to start the mass production of 5nm chips using its EUV (Extreme Ultraviolet) process this year. The company would also start focusing on the development of 3nm process nodes this year.

Developing larger camera sensors is also Samsung's area of interest. The company is aiming for a camera sensor that can surpass the capabilities of a human eye. It has already started making big strides towards this 600-megapixel camera sensor.

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The 108-megapixel ISOCELL Bright HMX found in the Galaxy S20 Ultra is Samsung's most advanced camera sensor as of now. The company is now working on a 150-megapixel and a 250-megapixel sensor.