Header - hero image Report by the Board of Directors
Report by the Board of Directors 2023

Research and Development

Bittium continued to make significant investments to develop its own products and product platforms. In January-December 2023, the R&D investments were EUR 20.2 million (EUR 22.3 million), representing 26.9 percent of the net sales (27.0 percent).

The R&D investments focused mainly on developing medical technology products, developing tactical communication system and its products for the defense industry, and special terminal products and their related security software targeted for authorities.

The capitalized R&D investments are related to the investments in developing Bittium Tough SDR™ software-defined radio-based tactical radio product family, further development of tactical communication networks, and development of medical technology products.

On October 30, 2023, Bittium announced its updated strategy concerning years 2024 and 2025. In the strategy the company is seeking a change from a R&D organization to a customer-oriented, growth-oriented operating model through its segment organizations.

Between 2016 and 2023, the company’s two Business Segments, Defense & Security and Medical, have invested strongly in the development of their own products. This has maintained the company’s high average annual R&D investment level of around EUR 20 million, corresponding to an average of approximately 25 percent of the company’s annual net sales. In both product-oriented Business Segments, the large product development projects have proceeded into commercial phase. During the next two years period, these segments will now focus on continuous improvement of the competitiveness of existing products and development of features, which is the highly important to competitiveness in both Business Segments. In addition, the company will use development cooperation with other companies in its product development in the future.

R&D investments, MEUR 1–12/20231–12/2022
Total R&D investments20.222.3
Capitalized R&D investments-7.2-6.6
Depreciations and impairment of R&D investments5.65.9
Cost impact on income statement18.621.5
R&D investments, % of net sales26.9 %27.0%
Capitalized R&D investments in balance sheet, MEUR 1–12/20231–12/2022
Balance sheet value in the beginning of the period48.848.1
Additions during the period7.26.6
Depreciations and impairment of R&D investments-5.6-5.9
Balance sheet value at the end of the period50.548.8