Apple's steady increase in research and development spending has stoked speculation that it working on cars, goggles and more.

But company's financial guru attributes the spending to something of a much smaller scale: chips. It may not sound like it, but that research is "very strategic and important" for Apple to differentiate itself from the rest of the industry, chief financial officer Luca Maestri said on Tuesday at the Goldman Sachs Technology and Internet Conference in San Francisco.



"Today, we do much more in-house development of some fundamental technologies than we used to do a few years ago, when we did more of that in the supplier base — the work we do around processors or sensors," Maestri said. "It's very important for us because we can push the envelope on innovation, we can better control timing, cost, quality. We look at that as a great strategic investment."

Apple spent more than $10 billion on research and development in 2016, up from $8.07 billion in 2015 and $6.04 billion in 2014. That means that Apple spent 5 percent of its total net sales on research last year, up from 3 percent in the prior two years.