The share and the size

R&D as a share of revenue says how much of each dollar goes into building what comes next. The dollar amount says how big the effort is. The two can point different ways.

Atlassian's share was five times Apple's. Yet Apple's R&D, at $45.8 billion, was about 14 times Atlassian's. Apple's R&D alone was larger than Atlassian's whole revenue, $6.6 billion, seven times over.

Why software spends a larger share

A software company's main cost is the people who write the software. It has no factories and ships no boxes. So engineering takes a large part of each dollar.

Datadog spent 45.2% of its 2025 revenue on R&D. Snowflake spent 42.0% in fiscal 2026. Both sell tools to engineers, and both add products every year to sell more to the same customers. Each new product starts as R&D long before it brings in revenue.

Why the share falls with size

Software costs about the same to build whether ten customers use it or ten million. As revenue grows, the same engineering spreads over more of it.

Microsoft spent 10.7% of its fiscal 2026 revenue on R&D, down from 12.3% five years earlier. The amount still rose, from $20.7 billion to $35.6 billion. Revenue simply grew faster.

NVIDIA shows it most sharply. Its R&D grew almost five times in five years, from $3.9 billion to $18.5 billion. Its revenue grew almost 13 times, from $16.7 billion to $215.9 billion. So its share fell from 23.5% to 8.6%.

When the share holds

Alphabet's share barely moved. It was 15.1% in 2020 and 15.2% in 2025, as R&D and revenue both grew 2.2 times. Alphabet keeps building as fast as it sells: search, cloud, models and the chips to run them.

Atlassian is close to that pattern at a smaller size. Its R&D grew 3.5 times in five years and its revenue 3.1 times.

The exception

Meta's share went the other way. It rose from 21.5% in 2020 to 28.5% in 2025, as R&D grew from $18.4 billion to $57.4 billion. Meta was building AI models and the devices of Reality Labs at the same time. Its operating margin was still 41.4%, because its advertising business carries the cost.

A high share is not a problem in itself. It says the company is still mostly building. A falling share says the products already built are bringing in more of the revenue.