Despite all the talk about disruption and reinvention, most CEOs still lead companies whose revenues are heavily tied to what they are already doing and have been doing for a long time.
Recently chief executive In a survey of 315 US CEOs, 58% said less than 10% of their company's current revenue comes from products and services they didn't offer five years ago. Currently, only one in four say at least 20% of their revenue comes from new products.
That doesn't mean CEOs are against innovation. Looking ahead three to five years, 77% said expanding into new categories, markets and products will be very important or important to their company's ability to grow and remain competitive. Nearly 30% said it was important.
The same pattern was seen when CEOs were asked whether their companies had entered new verticals, customer categories, markets, or use cases in the past five years. Only 22% say these movements are now a significant source of revenue and growth. A much larger share (43%) said they had expanded into new areas, but their efforts had limited impact on their bottom line.
Technologies such as AI are compressing product cycles and creating new use cases. Competitive threats are increasing not only from direct rivals, but also from companies that completely redefine adjacent categories, new business models, and customer problems.
Mark Grosskopf, CEO of New Resources Consulting, said: “AI will have a huge impact, much sooner than most expected…Everyone needs a plan to address their business models.”
keep investing
Investment levels, as measured by R&D spending, vary widely, but the median remains relatively modest.
Research and development spending at U.S. companies will account for an average of 8.8% of net revenue in 2025, and is expected to rise to 9.4% in 2026, according to the study. This is up from prior estimates of 7% in 2023 and 6% in 2024, according to the U.S. Corporate Financial Performance Benchmark Report, but caution should be taken with averages: R&D spending can be skewed towards early-stage companies with lower profits and technology-oriented companies with lower bases and higher development costs. The median response was lower, at 5% in both 2025 and 2026. This suggests that for many companies, formal R&D remains a fairly small share of revenue.
Division of ownership
Ownership type was one of the most obvious points of variation in the survey.
In our research, private equity-backed companies were among the most expansion-oriented companies. Nearly one-third say new areas, categories, markets, or use cases are currently important sources of revenue or growth, and 88% say expanding into new categories, markets, or services is essential or important to their future competitiveness.
By comparison, family-owned businesses were less likely to report that new areas became important sources of revenue and less likely to rate future expansion as important or important.
For Taymi Marrero, CEO of Ground Power Parts, this contrast is a major concern. “As a small business owner for more than a decade, the biggest challenge I see going forward is that large corporations are stealing market share, leaving small, family-owned businesses with little opportunity to recover and expand. That's where our country is headed in almost every sector.”
sector view
Industrial manufacturing, the largest industry group surveyed, showed outstanding results in innovation. 31% of CEOs say expanding into new verticals, customer categories, markets, or use cases has become an important source of revenue and growth, compared to 22% of CEOs overall. More than 8 in 10 say expanding into new categories, markets or products is essential or important to their competitiveness over the next three to five years.
Technology, software, and telecommunications companies also reported higher R&D expenses as a percentage of revenue. They were also more likely than the surveyed group as a whole to say at least 20% of their revenue came from services introduced in the past five years.
In healthcare, not a single CEO surveyed said that expanding into new areas, customer categories, markets, or use cases was a significant source of revenue or growth. However, 86% say expansion will continue to be important or important. In the construction/mining industry, CEOs report that less than 10% of their revenue comes from products and services that were not delivered five years ago.
