R&D to RevenueView Financial Glossary Index
The Research & Development (R&D) Expense to Revenue ratio measures the percentage of sales that is allocated to R&D expenditures. It is not as effective when looking at companies in different industries because different industries place different values on R&D. Technology companies and pharmaceutical companies are more likely to have high R&D ratios.
R&D to Revenue = Research and Development Expense / Total Revenue