Samsung lags behind competitors R&D spending for chips

South Korea's Samsung Electronics Co. ranks behind its competitors in investing in research and development for chips, a business segment that the tech firm has set out to expand to pick up the slack from weakening handset sales.

According to market tracker IC Insights Inc., Samsung came in third after Intel Corp. and Qualcomm Inc. of the United States in R&D spending last year.

Samsung allocated $2.96 billion in 2014, compared with Intel's $11.5 billion and Qualcomm's $5.5 billion, the report said.

U.S.-based Broadcom Corp. and Taiwan Semiconductor Manufacturing Company followed at $2.37 billion and $1.8 billion, respectively, trailed by Japan's Toshiba Corp. and Swiss-based STMicroelectronics.

SK hynix Inc., Samsung's smaller South Korean rival, ranked 12th with $1.33 billion, the report said.

In terms of the ratio of R&D spending to combined chip sales, Samsung made it to the top-10 bracket, ranking ninth with 7.8 percent. U.S. Nvidia Corp. took the top spot with 31.3 percent, followed by Qualcomm with 28.5 percent and Broadcom with 28.2 percent. Intel had a ratio of 22.4 percent.

Samsung Electronics installed its own chips in its new flagship smartphone, the Galaxy S6, which will hit the market next month, breaking away from major supplier Qualcomm. The South Korean company is also seen trying to secure external customers in the chip division which, together with its panel business, helped limit the earnings fall in the fourth quarter.

Samsung had spent some 14.3 trillion won ($13 billion) on facility investment for the chip division in 2014. In January, a Samsung official said the amount is set to increase this year.

The company also said it will especially focus on system large scale integration and NAND flash businesses. (Yonhap)