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IBM Maintains Patent Dominance, MSFT, AMZN & AAPL Catch Up

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Technology companies like International Business Machines (IBM - Free Report) , Samsung, Microsoft (MSFT - Free Report) , Intel, Apple (AAPL - Free Report) , Amazon (AMZN - Free Report) and Huawei, among others, have been granted a record number of patents in 2019.

Per IFI CLAIMS Patent Services data, an all-time high of 333,530 U.S. patents were granted in 2019, up 15% over the 2018 tally, thanks to more clarity on patent-granting rules.

IBM maintained the lead spot for the 27th year, with 9,262 patents, reflecting a 2% rise year over year. Samsung grabbed the second position with 6,469 patents, up 11%.

Microsoft moved up three ranks, claiming the fourth position with 3,081 patents, up 31%. The patents primarily involve specialized hinge systems and innovation in speech recognition. These innovations are expected to aid this Zacks Rank #3 (Hold) company enhance its Surface devices and Cortana services.

Apple ranks seventh, moving up two positions on a 15% surge in patent grants, which totaled 2,490 in 2019. Advancements in AirPods technology and patents related to Apple Watch, iPhone displays, audio enhancing Virtual Acoustics Audio System for MacBooks are noteworthy in this respect. Apple currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Apple Inc. Price and Consensus

Apple Inc. Price and Consensus

Apple Inc. price-consensus-chart | Apple Inc. Quote

Amazon moved up three ranks, taking the ninth position with 2,427 patents, up 19% year over year. The company’s speech recognition and machine learning patent wins are likely to enhance Alexa’s voice computing capabilities. The company currently carries a Zacks Rank #3.

Facebook (FB - Free Report) jumped 22 places to rank 36, courtesy of a 64% surge in patent grants. The social media giant’s focus on VR is well reflected in its patent wins last year. The latest VR patent grants are expected to help this Zacks Rank #3 company enhance its Oculus glasses and make the VR experience more engaging.

Optimism Over Huawei Patent Wins on Trade Deal

Companies based in the United States accounted for 49% of the patents granted in 2019, compared with 46% in 2018.

Meanwhile, China ranked fourth with 5%, beating Germany. China’s position on the list can be primarily credited to tech giant Huawei, which secured the 10th position with 2,418 patent grants, up 44% year over year.

Notably, majority of the patents granted to Huawei pertain to advancements in 5G, primarily involving high-frequency transmission.

The recent trade deal between the United States and China could lend further support to Huawei’s push to gain more patents, as some analysts suggest.

IBM Patents Focus on AI, Blockchain & Quantum Computing

IBM’s record patent grants make it well poised to attain breakthroughs in emerging technologies, involving blockchain, quantum computing, security, AI and cloud computing.

IBM notes that in AI, the company patented more than 1,800 inventions in 2019, primarily involving natural language processing. In the cloud vertical, the company registered more than 2,500 U.S. patents, with hybrid cloud being a top priority.

In security applications, this Zacks Rank #3 company is focusing on emerging crypto scheme named homomorphic encryption, which enables “data manipulation without decrypting the data first.” In the blockchain domain, the company is striving to make room for enhancements in transparency, verification and security. IBM notes that one such patent is an attempt to address ‘replay attacks’ and secure the blockchain network.

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