Financial Statements
Research and Development
Money spent to create, improve, or test products, services, or technology.
Also called: R&D, research spending
What it means
Research and development, often called R&D, includes spending on new products, technology, formulas, features, or processes. In some industries it is a major driver of future growth, while in others it is less central.
Why it matters
R&D can signal how much a company is investing in future competitiveness, though high spending does not automatically guarantee results.