Over the past week, there seems to be no one who hasn’t heard the name “Nvidia“. The chip giant’s stock, recently dubbed as “the best company in the world”, soared 16% at the end of last week following the release of positive reports. This is the greatest daily increase in value ever recorded. Overall, the stock has leaped more than 600% from October 2022 to the present, pushing the company past the $2 trillion value mark. Hence, numerous employees have become millionaires from the options they received.
How much did Nvidia’s Israeli division contribute to its global success? Nvidia’s second-largest development center outside of the US is in Israel. With over 3,300 employees, it is one of Israel’s largest employers, accounting for 13% of its global workforce. This number equals all the company’s employees across 16 countries in Europe and all of India. Nvidia CEO Jensen Huang stated six months ago that “Israel is home to some of the world’s leading artificial intelligence researchers and developers, who create applications that will drive the next wave of AI developments.”
Indeed, Nvidia’s operations in Israel play a significant role in its global sensation. Last May, the company unveiled a series of key products developed in Israel, led by Israel 1, the country’s most powerful supercomputer. An official at the company noted: “In Israel, the company develops technologies that have a global impact; these are technologies that are one of the engines that enable breakthroughs in many fields, including gaming, medicine, and even the climate crisis.”
Entry into the country and acquisition of the giant
Nvidia began its journey in Israel in 2016 when it opened its first development center in the country. Today, it has development centers in various locations including Yokneam, Tel Aviv, Ra’anana, Jerusalem, Be’er Sheva, Kiryat Gat and Tel Hai. Nvidia’s local activities focus on the field of accelerated communications (networking), and it develops chips, switches, software and hardware platforms, among other things. A company source noted that Nvidia is involved in the development of two of the company’s three core chips in Israel.
Between 2019 and 2020, Nvidia made one of the largest deals with an Israeli company when it announced the acquisition of Mellanox Mikneam for approximately 7 billion dollars. Mellanox, which is involved in the development and production of communication equipment for fast data transfer, was fiercely competed for by seven companies.
Nvidia later expanded its operations in Israel by acquiring other companies, including the startup Excelero, which specializes in the development and production of storage technologies. In addition, Nvidia established an international research group for artificial intelligence technologies, under the name Nvidia Research.
Continuous activity despite the war
Since the surprise attack by Hamas on October 7, the war in Gaza has impacted many companies in the Israeli economy. However, Nvidia has been striving to maintain business as usual. In December, two months after the fighting began, the company held a local investor conference. The event was part of the company’s global program, NVIDIA Inception, designed to support startups.
Will success lead to complacency?
Despite Nvidia’s success, the company faces significant challenges. Last December, it was reported that the CEO of Nvidia expressed concern that some of the company’s veteran employees are nearing a kind of “hidden retirement”. The reason for this is that many of them have become wealthy as a result of the company’s surging stock in recent years, which may impact their productivity.
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