Technology Companies = Largest + Fastest Growing R&D + Capex Spenders, USA Research & Development Spend + Capital Expenditures – Select USA GICS Sectors $300B Technology +9% CAGR +18% Y/Y USA , x $200B Cape Healthcare* D + +4% CAGR R& +8% Y/Y $100B Discretionary 0% CAGR -22% Y/Y $0 2007 2009 2011 2013 2015 2017 Technology Healthcare Energy Materials Industrials Discretionary Staples Utilities Telecom Source: ClariFi, Katy Huberty @ Morgan Stanley. GICS = Global Industry Classification Standard, an industry taxonomy developed in 1999 by MSCI and Standard & Poor's (S&P) for use by the global financial community. CAGR = Compounded annual growth rate from 2007-2017. Note: Amazon, Netflix and Expedia removed from Discretionary 41 Sector & added to Technology. Discretionary includes companies that sell goods & services that are considered non-essential by consumers such as Starbucks (restaurants) & Nike (apparel). See appendix for detailed GICs definition. ClariFi does not have R&D or Capex data from Financial Services. *Healthcare Includes pharmaceutical companies.