Technology

Who Are the World's Largest Patent Holders?

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Patents are often seen as a reflection of a company’s capacity and commitment for innovation. The World Intellectual Property Organization (WIPO) defines a patent as “an exclusive right granted for an invention. In other words, a patent is an exclusive right to a product or a process that generally provides a new way of doing something or offers a new technical solution to a problem.”

Therefore, patenting an idea or innovation is considered necessary to secure research and development (R&D) efforts, which will then eventually lead to economic gains.

Here’s an overview of the patent landscape in 2022, according to data by IFI Claims Patent Service.

Samsung claims the number one spot

With 6,248 patents granted during the year, Samsung (SSNLF) is the highest patent holder for 2022. The number of patent grants was down 2% vis-à-vis last year. In terms of cumulative patent holdings, Samsung is down by one spot to the second position with 92,593 active patent families. The South Korean conglomerate is the largest non-U.S. spender on R&D. Recently reported numbers for FY2022 show Samsung’s R&D spending ₩24.92 trillion ($20.14 billion) at 8.2% of sales, which stood at ₩302.23 trillion.

Samsung has 15 R&D centers in 14 countries. Samsung R&D Institute (SRI-B) in Bengaluru is the company’s largest R&D center outside Korea. SRI-B has filed over 7,500 patents in India and globally (till October 2022). According to Samsung, “Engineers at SRI-B have filed patents around areas such as multi-camera solutions, 5G, 6G as well as ultra-wideband wireless communications protocol. These patents have been commercialized in Samsung flagship Galaxy smartphones, smartwatches, and network equipment, among others.”

In December 2022, Samsung’s $220 million project for its R&D center in Vietnam, which was undertaken in 2020, was completed.

With a shift in its strategy, IBM moves to the second spot

IBM (IBM), popularly referred to as the Big Blue, has been leading the U.S. companies for 29 years in the number of patents received annually. However, the year 2022 witnessed a sharp fall of 49% in the number of patents granted. IBM received 4,398 patents in 2022 vis-à-vis 8,681 patents in 2021. This fall in number is an outcome of the company’s shift in approach making it more ‘focused.’ IBM’s Senior Vice President and Director of Research Darío Gil wrote, “While we will remain an intellectual property powerhouse with one of the strongest US patent portfolios, as part of our innovation strategy, focus means that we are taking a more selective approach to patenting.”

Key areas of innovation for IBM include hybrid cloud, data and AI, automation, security, semiconductors and quantum computing—which require deep focus and depth, and hence the company is working to free its engineers as it “needs more hands on the deck for each breakthrough.” In terms of the cumulative patent holdings globally, IBM ranked 16th with 43,014 active patent families.

TSMC moves up to the third position

Taiwan Semiconductor Manufacturing (TSM) placed itself comfortably among the top five patent holders in 2021 to be at the fourth spot, and in 2022, it continued its climb to the third place. During 2022, TSMC was awarded 3,024 patents, an 8% increase as compared to the previous year. TSMC is the world’s leading dedicated semiconductor foundry dominating more than 55% of the market share. A report by Counterpoint suggests that TSMC’s market share saw significant growth through 2022 and is expected to be around 60% in Q4 2022, up from 59% in Q3 2022.

TSMC’s Intellectual Patent Division (IPD) has “established a robust patent management system, which comprehensively constructs the patent territory through five strategies and four enforcement measures.”

Together, IPD and the R&D team develop short-, medium- and long-term technology plans. TSMC boasts of high patent quality, and the approval rate of its applications. TSMC reported a revenue of NT$2,263.89 billion ($75.88 billion) in 2022, an increase of 42.6% compared to the same period in FY2021. The company continues to spend 8-9% of the revenue on R&D.

Huawei inches up to the fourth place

Huawei has made a steady progress in the last two years, moving from the ninth spot in 2020 to the fifth place in 2021, and now to the fourth place. Huawei was awarded a total of 2,836 patents in 2022, an increase of 2%. Huawei is a leading global provider of information and communications technology (ICT) infrastructure and smart devices. While the company is yet to report its final revenue for FY2022, a note at the start of 2023 by the company’s chairman mentions that Huawei “We expect to round off the year with a total revenue of ¥636.9 billion, which is in line with forecast.”

Over the years, Huawei has been investing heavily into R&D. Over the past decade, Huawei’s total R&D investment surpassed ¥845 billion. The number of people working in the company’s R&D constitutes more than half of its total workforce.

“Huawei leads in mainstream standards such as 5G, Wi-Fi 6 and H.266, and has entered into licensing agreements with pioneers in a wide range of areas, including the telecoms industry, connected cars, Internet of Things, and smart homes” according to Huawei.

Canon is at five

With 2,694 patents, Canon (CAJ) continues to be the only company in the world to have ranked in the top five for 37 years. Canon has reigned the third position for more than a decade but an 11% fall in the number of patent grants slid Canon to the fifth spot. Canon continues to retain the number one spot among Japanese companies for the 18th consecutive year. When seen in terms of cumulative patent holdings, Canon moved up to the fifth spot (from ninth) with 73,448 active patent families.

Canon’s four key business groups include printing, imaging, medical and industrial equipment. According to Canon, in recent years, “the company has been focusing on development of fundamental technologies, such as video analysis, cutting-edge image sensors, volumetric video and healthcare AI, that can be applied and utilized for various purposes, as well as the acquisition of patent rights for such technologies.”

The company’s R&D expenses for FY2022 were reported at ¥306.73 billion, equivalent to 7.6% of net sales. Canon has been allocating 7-9% of its net sales to R&D expenses over the years.

Rounding Up

With 2,641 patents, LG Electronics is at the sixth place, up by two places compared to 2021. The number of patents awarded to LG increased by 6% during the year.

With a solid 22% rise in patents received during 2022, Qualcomm (QCOM) rose from the tenth spot to the seventh. The company received 2,625 patents during the year.

Intel (INTC) received 2,418 patents during 2022, a drop of 7% since 2021 resulting in a slide by two places to the eighth spot.

A 10% fall in the number of patent grants during 2022 pushed Apple (AAPL) down by two places. Apple was awarded 2,285 patents during the year.

Toyota (TM) made it to the top ten with a 9% rise in patent grants. The company was granted 2,214 patents during 2022.

In Percentage Terms

While the rankings above are in absolute numbers, the top five names when seen in terms of parentage increase in patents are Dell (44%), Hewlett Packard (41%), Murata Manufacturing (23%), Qualcomm (22%) and Robert Bosch (18%).

Disclaimer: The author has no position in any stocks mentioned. Investors should consider the above information not as a de facto recommendation, but as an idea for further consideration. The report has been carefully prepared, and any exclusions or errors in it are totally unintentional. Data on patent is based on IFI Claims Patent Services report. Company specific data based on earnings and annual reports.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Prableen Bajpai

Prableen Bajpai is the founder of FinFix Research and Analytics which is an all women financial research and wealth management firm. She holds a bachelor (honours) and master’s degree in economics with a major in econometrics and macroeconomics. Prableen is a Chartered Financial Analyst (CFA, ICFAI) and a CFP®.

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