The news that Nvidia’s board of directors plans to oust CEO and founder Jensen Huang has sparked deep concern among the chip giant’s employees in Israel about the company’s ongoing commitment to the country. Huang has been a staunch supporter of Israel’s tech sector; over the years and has transformed the company’s development centers in Yokneam and Tel Aviv into a vital pillar for the firm, to such an extent that, according to second-quarter financial reports, operations managed from Israel account for 18% of the Nvidia’s total revenue.
Many even believe that Nvidia’s substantial presence makes Israel immune to severe economic sanctions, as any harm to Israel could, in turn, negatively impact the chip giant’s standing on the New York Stock Exchange.
Huang’s appreciation for Israeli engineers has been demonstrated over the years through both words and actions. He spearheaded the 2019 acquisition of Mellanox, a communications chip company founded by former Intel employees and led by Eyal Waldman, and expanded its Israeli operations from a small research and testing lab employing a few dozen people into a major hub with approximately 6,000 engineers, responsible for a product that is absolutely critical to Nvidia’s growth.
Undeniable importance
Unlike Google’s approach when it acquired Waze, Nvidia agreed to keep Mellanox as an Israeli company, retaining its Israeli intellectual property, recording its revenue in Israel, and paying higher tax rates, to such an extent that its revenue now accounts for an ever-growing share of Israel’s GDP.
Huang not only kept Mellanox’s intellectual property in Israel, he transformed the company into an independent business unit. From its offices in Yokneam and Tel Aviv, it now manages Nvidia’s entire communications chip division, including the critical operations that facilitate connectivity between geographically dispersed data centers. Michael Kagan, formerly Mellanox’s CTO, became Nvidia’s CTO, which makes him Huang’s potential successor.
And for good reason: the importance of Mellanox to Nvidia, and to the AI revolution as a whole, is undeniable. To process an increasing volume of AI operations (or tokens), Nvidia’s graphics processing units (GPUs) must communicate with one another, as well as with other processors, including Data Processing Units (DPUs) that manage data storage, and central processing units (CPUs) that handle core computing tasks. Mellanox is responsible for developing the data traffic between chips - a form of communication that is becoming an increasingly vital asset. This is crucial for Nvidia to meet the surging demand for AI processing, especially as data centers expand to include a growing number of servers, and as major corporations need faster connectivity between data centers.
Furthermore, Nvidia’s best-selling product, the NVLink-based AI processing system, is managed from Yokneam. This system integrates Nvidia’s GPUs with Mellanox’s networking technology. While considered a high-end, premium product, it is highly trusted by cloud giants and neo-cloud companies alike. In the second quarter, Nvidia Israel’s sales reached $17.5 billion, maintaining a record-high 18% share of the company’s total global revenue. Nvidia CFO Colette Kress, also a potential candidate for the CEO position, notes that the Spectrum-X networking switch (based on the Ethernet protocol and developed in Israel) saw its annual sales grow by a factor of 2.6. This growth has been a key factor in making Nvidia the fastest-growing networking company in the world. Spectrum-X is a system comprising a network switch and network interface cards (NICs) that allow data to move between GPUs with greater speed and efficiency, thereby enabling a higher volume of AI operations to be processed simultaneously.
Based on second-quarter data, Nvidia Israel has emerged as the highest-revenue Israeli entity; for comparison, Teva generated $4.1 billion in the second quarter, while Check Point recorded $674 million. Israel Aerospace Industries (IAI), which reports on a semi-annual basis, reported $4.2 billion in revenue for the first two quarters of 2026, while Elbit Systems’ revenue for the second quarter reached $2.2 billion.
Although Nvidia has about 6,000 employees in Israel, making it, ostensibly, smaller than Intel, which is estimated to have over 8,000 employees, it is indisputably the fastest-growing international company in Israel. In fact, the company has doubled in size since October 7, 2023 when it employed just over 3,000 people, driven by the AI revolution. Notably, the company, led by Jensen Huang, has committed to building a development center and laboratory campus in Kiryat Tivon capable of housing as many as 10,000 new employees over the coming decade.
Published by Globes, Israel business news - en.globes.co.il - on November 12, 2026.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2026.