Using Chinese industrial firms data from the National Bureau of statistics this paper analyzes the influence of R&D investment on the firm performance. The results show: (1) R&D investment has an inverted U-shaped influence on firm performance, this relationship is deeper in firms with high level of human capital; (2) patent application and authorization strengthen the positive role of R&D investment on firm' performance; (3) when the institution environment is weaker, the R&D investment is harmful to firm' performance, and this effect is more pronounced in non-state-owned firms. This paper extends the theoretical framework for the study of R&D investment economic consequences from the four aspects of investment intensity, innovation behavior and institutional environment, and provides implications for the government .