There's a pretty good overview of the research areas here: https://www.microsoft.com/en-us/research/

There's also a Microsoft Research podcast with interviews here: https://www.microsoft.com/en-us/research/blog/category/podca...

A lot of stuff you'd expect like AI, ML, HCI, cloud computing, security, but also stuff like acoustics, social media impacts of computing, biology and medicine, etc.

R&D is not just "research", it's also "development". All money spent on engineering work count toward that 16 billion.