Patent Insight 5: Shifts in Innovation: Top Growing and Declining Companies in Patents (2023)
Our latest annual Patent Intelligence Report was released in late March of this year. This report reflects our comprehensive analysis of five years' worth of patent data, spanning from January 1, 2019, to December 31, 2023. A variety of metrics related to patent activity were extracted and analyzed to offer an in-depth and holistic view of the current patent landscape in the U.S.
In previous patent insights, we shared several highlights from this report. These included Saudi Arabia maintaining its position as the second most active foreign country in patent filing, top patent firms managing to secure the broadest claims in Apple's patents, and the top lateral moves made by attorneys over the past year. These analyses have all added several valuable dimensions to our readers’ understanding of the patent environment.
This week, we changed our focus to reflect on the changing dynamics of patent issuance from 2022 to 2023. As we examine these shifts, we will zero in on the top growing and declining companies, delivering an analysis of their activity shifts, and the probable factors influencing their evolution and contributing to their fluctuating standing in their respective industries.
To get a full understanding of trends in patenting, it is crucial to examine both patent application filings and the patents that have been granted yearly. The USPTO usually publishes patent applications around 18 months after their filing, which makes these published applications a reliable indicator of the patent filing activity during a certain period. Throughout our study period, which spans from January 1, 2019, to December 31, 2023, a total of 1,882,495 patents were issued and 1,990,642 applications were published by the USPTO. By comparing the published applications and issued patents for the last two years, it becomes evident that there has been a slight decrease in both domains. In 2022, there were 377,710 published applications and 360,067 issued patents. Fast forward to 2023, the number of published applications dropped to 365,822 while issued patents also saw a decline to 348,114. The patterns observed in patent application filings and granted patents may serve as an indication of evolving innovation scenarios, alterations in industry dynamics, or changes in legislative landscapes. Multiple factors such as prevailing economic situations, advancements in technology, and changes in intellectual property strategies among corporations may also have a stake in steering these trends.
Having examined the trends, our attention now turns to analyzing the entities with notable changes in their activity levels. Our examination is specifically geared towards identifying which entities have undergone considerable growth or decline. For this purpose, we confined our analysis to the top 2,000 most active companies in 2023 and conducted a comparative examination using patent issuance data from 2022. Instead of focusing on the percentage of change, our comparison centered on the absolute numbers. This approach takes into consideration that among companies with a small patent portfolio, a minute increase or decrease can dramatically skew the percentage change. To better illustrate this, the following bar chart displays the top five companies that experienced the most significant decline in 2023:
- BOE Technology Group Co., Ltd. is a company that specializes in semiconductor display technologies, products, and services, based in Beijing, China. It has consistently been one of the leading companies in the issuance of patents. In 2022, it ranked as the top growing in this regard. However, there was a decrease of 37.39% in the number of patents they issued in 2023. The company also reported a noticeable drop in attributable profit, falling to 2.55 billion yuan (approximately $347.31 million) in 2023, a substantial decrease from 7.54 billion yuan (roughly $1.03 billion) the previous year, marking a 66.22% decline. Despite these challenges, BOE Technology remains committed to innovation and has plans to invest $7 billion in research and development over the next three years.
- LG Electronics is a globally recognized leader in electronics; however, its patents dropped by 14.88% in 2023. Despite this, they plan to invest around $39.5 billion in R&D, facilities, and strategic investment in an ambitious growth plan to reach $79 billion in sales by 2030. LG has shown interest in new businesses, such as electric vehicle (EV) charging and robotics, with already announced plans to invest in these fields.
- IBM has been the leader in the rankings for holding the most patents in the U.S. for decades and was surpassed by Samsung in 2022. They cite a shift in patenting strategy redirecting the resources and talent towards making high-quality advancements in specific areas such as hybrid cloud, data and AI, automation, security, semiconductors, and quantum computing.
- Hewlett Packard Enterprise is a leading company that operates in the information technology industry. Their issued patents declined by 38.28% in 2023, but despite that, their R&D spending has consistently increased, including in 2023. Meanwhile, their revenue has remained relatively stable over the past few years, increasing by 2.24% to $29.13 billion in 2023.
- Mitsubishi Electric Corporation is a global conglomerate headquartered in Japan with multiple business segments spread across various industries such as automotive, banking, electronics, real estate, which are managed independently. In 2023, there was a significant decline in issued patents, with numbers dropping by 32.48%. Nevertheless, their revenue and R&D expenditures continue to grow annually. In a prior analysis, we discussed how numerous Japanese companies have adjusted their IP strategies both domestically and internationally.
Directing our attention away from the companies that saw a decline in 2023, it's vital to highlight those who experienced significant growth contrasting the overall declining trend. Staying ahead in the innovation game, these companies successfully expanded their patent portfolios compared to their previous year's performance. The following chart illustrates the top five companies that marked the highest growth in patents issued during 2023:
- The number of patents issued to Qualcomm Technologies, Inc. saw another substantial increase in 2023, rising by 47.72%. This growth follows a similar trend observed in 2022, where patents grew by 23.06%. The advancements in 5G technology and the innovative strides towards 6G development were the main factors contributing to the surge in patents issued in 2023. Additionally, it's worth mentioning that Qualcomm maintains profit margins surpassing those of typical chip companies. Their distinctive approach, blending licensing and product business strategies concerning patent rights, has consistently yielded high profit margins. This unique strategy has further incentivized the company to intensify its patent portfolio. Holland & Hart and Patterson + Sheridan are their top law firms when it comes to patent prosecution.
- Taiwan Semiconductor Manufacturing Company, the world's largest contract chipmaker, remains the top patent applicant in Taiwan for the eighth year consecutively. They have observed growth both domestically and in the number of patents issued in the USA in 2023, with an increase of 21.25%. TSMC is set to innovate in several key areas, including developing a Beyond-3nm logic technology platform and applications, enhancing 3D IC technology, advancing next-generation lithography such as EUV, and conducting long-term research in specialty SoC technology and transistors with an 8 to 10-year horizon. Slater Matsil, Haynes and Boone, LLP, and JC IP Group are their top law firms.
- Samsung Electronics holds the position of the most active company by the number of patents issued over the past five years. In 2023, they experienced a growth of 6.16%, resulting in 551 more patents issued compared to 2022. Samsung is well-known for its constant pursuit of innovation, which leads to developments that are patented. They have yearly increased the R&D investment which has contributed to the growth in patents. Their top law firms for patent prosecution are Sughrue Mion, Jefferson IP Law, and Lewis Roca Rothgerber Christie LLP.
- Alphabet Inc., the parent company of Google and several other subsidiaries, is known for its significant investments in research and development across various technology fields. Alphabet Inc. operates in diverse fields - from search engines and advertising to cloud computing, hardware, software, and artificial intelligence. This broad base of operations allows for a multitude of innovations and patents. In 2023 they were issued 17.43% more patents than in 2022. Alphabet's research and development expenditures have consistently increased year over year. For the twelve months ending March 31, 2024, Alphabet's research and development expenses amounted to $45.862 billion, marking a notable 9.59% rise compared to the previous year. Fish & Richardson, McDonnell Boehnen Hulbert & Berghoff LLP, and Dority & Manning, P.A. are their top law firms for patent prosecution.
- Micron Technology, Inc. has been an industry leader in innovative memory and storage solutions, committed to innovation and technological advancements, which has led to a rise in patentable inventions. The number of issued patents has been increasing steadily for the past years, reaching 2,264 in 2023, 17.18% more than in 2022. In 2023, Micron Technology spent 3.11 billion U.S. dollars on research and development. Brooks Cameron & Huebsch, Holland & Hart, and Dorsey & Whitney LLP.
The table below provides a summary of companies experiencing the most significant growth and decline, along with additional details such as the number of patents they acquired in 2020 and 2021, followed by the absolute change and percentage change during this two-year period:
| Company | Difference | 2023 Patents | 2022 Patents | Change |
|---|---|---|---|---|
| Qualcomm Technologies, Inc. |
1,265 |
3,916 | 2,651 | 47.72% |
| Taiwan Semiconductor Manufacturing Company | 644 | 3,674 | 3,030 | 21.25% |
| Samsung Electronics | 551 | 9,498 | 8,947 | 6.16% |
| Alphabet Inc. | 396 | 2,668 | 2,272 | 17.43% |
| Micron Technology, Inc. | 332 | 2,264 | 1,932 | 17.18% |
| Mitsubishi Electric Corporation | -720 | 1,497 | 2,217 | -32.48% |
| Hewlett Packard Enterprise | -730 | 1,177 | 1,907 | -38.28% |
| International Business Machines | -777 | 3,964 | 4,741 | -16.39% |
| LG Electronics | -778 | 4,450 | 5,228 | -14.88% |
| BOE Technology Group Co., Ltd. | -1,024 | 1,715 | 2,739 | -37.39% |
The full Patent Prosecution Intelligence Report further includes the analysis of top 2,000 most active companies, categorizing them based on their activity and performance across three distinct sectors: biotech, high-tech, and overall. Stay tuned, as in the upcoming weeks, we will extend the report’s coverage by featuring the top growing and declining law firms.