Title: Relationship between profitability and US firm strategies for research and development intensity and capital investment

Authors: Takayuki Suzuki; Hiroshi Imahashi; Kiminori Gemba

Addresses: Department of Business Administration, Kyoto University of Advanced Science, Japan ' Department of Management Information, Kyoto College of Economics, Kyoto, Japan ' Department of Innovation Management, Hosei University, Japan

Abstract: Research and development (R&D) has been associated with the accomplishment of business results through capital investment. In recent years, the efficiency of R&D investment by US firms has declined; however, there is a lack of empirical evidence. Therefore, this study empirically analyses the relationship between R&D, capital investments, and the US firms' profitability. A regression analysis was conducted using data from US stock market-listed firms between fiscal years (FY) 2010 to 2021. The results indicate a significantly negative R&D ratio coefficient for all years. Additionally, the capital investment ratio coefficient was significantly positive in FY2019 and FY2021. However, for FY2011 it was positive but insignificant. The coefficients were significantly negative for all other years. The results indicate decreased efficiency of R&D investments by US firms, indicating opportunities to enhance their profitability. Moreover, the findings contribute to the existing literature and will assist practitioners make more informed management-related decisions.

Keywords: research and development expenses; capital expenditure; profitability; research and development intensity; US firms' strategy; investment efficiency; quantitative analysis; longitudinal study; stock market-listed firms; empirical analysis; innovation strategy; corporate investment strategies; technological capabilities; management decision-making; industry-specific analysis.

DOI: 10.1504/IJTM.2025.151884

International Journal of Technology Management, 2025 Vol.99 No.1/2, pp.1 - 22

Received: 05 Feb 2024
Accepted: 24 Jan 2025
Published online: 25 Feb 2026 *

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