What is Capital Expenditure?

A definition of Capital Expenditure

“Capital expenditure refers to funds used by a company to acquire, upgrade, and maintain physical assets such as property, industrial buildings, or equipment. It is often used to undertake new projects or investments by the company.”

Capital Expenditure in Business Glossary - What is a Capital Expenditure?

Business Glossary > What is Capital Expenditure?


Examples of Capital Expenditure in a Sentence:

The company increased its capital expenditure to upgrade infrastructure.

High capital expenditure can indicate investments in future growth.

Reducing capital expenditure may free up cash flow in the short term.

Why is Capital Expenditure Important in Business?

Prioritizing capital expenditure is crucial for a company’s growth and operational efficiency. These expenditures enable businesses to expand their operations, improve efficiency, and gain a competitive edge in the market. Understanding capital expenditure helps in asset management and long-term planning.

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Associated Terms

Here are some associated business terms and synonyms for “Capital Expenditure”:

  • CapEx
  • Capital Investment
  • Capital Spending

Apple Inc. Capital Expenditure

Apple Inc. invests significantly in capital expenditure to expand its manufacturing capabilities and improve its supply chains. These investments support its product innovations and global expansion strategies, helping maintain its competitive position in the technology market.

Final Notes on Capital Expenditure

When assessing capital expenditure, companies should consider:

  • Impact on future revenues
  • Potential for cost savings
  • The strategic alignment with business goals

Proper management of capital expenditure ensures sustained growth and competitive advantage.


This has been a definition of Capital Expenditure meaning.

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