Economy news
Israeli Life Sciences Investment Plunged 40 Percent in 2025, IATI Report Finds
A joint IATI-Israel Innovation Authority annual report released Sunday found that investment in Israeli life sciences companies fell from $2 billion in 2024 to $1.4 billion in 2025, below even 2023's $1.7 billion and less than half the $3 billion peaks of 2021-2022. Public market raises collapsed from $637 million in 2024 to just $116 million in 2025, with the decline concentrated in medical devices that had led the 2024 rebound. The report warned that Israel is missing the global biomed recovery, noting that 'such numbers generally indicate that many companies are raising small sums simply to survive until the end of the crisis.' Merger and acquisition activity held nearly steady at $1.3 billion. The findings raise fresh structural concerns for a sector once seen as a global standout, even as AI and defense exports keep the overall Israeli economy expanding.
Primary:(1)Secondary:(2)(3)(4)US AI Giant Crusoe to Invest $10B in Israeli Data Centers, Targeting 150 MW
American neocloud company Crusoe announced a $10 billion investment in Israeli data center capacity over the next 10 to 15 years, expanding its leases by 100 megawatts with the Anan Group, owned by singer Omer Adam alongside Maor Melul and Nessim-Sariel Gaon, and Zahi Nahmias's MegaDC. Crusoe Israel head Alon Yariv said the company will deploy at least 45,000 of Nvidia's newest Vera Rubin processors, anchored by a flagship 58 megawatt site at the Idan HaNegev Industrial Park near Rahat. Within two years Crusoe expects roughly 150 megawatts of Israeli capacity, overtaking Dutch-Israeli rival Nebius and making Israel one of its largest global markets. The announcement caps a string of mega-deals that have turned Israel into a top destination for AI infrastructure, validating the government's February designation of data centers as national infrastructure. Crusoe, which counts OpenAI and Oracle among its clients, is valued at $10 billion after raising $1.375 billion last October.
Sources:(1)(2)(3)(4)(5)TASE Routed as US-Iran MOU Erases Wartime Rally; TA-125 Down Nearly 11% in June
The Tel Aviv Stock Exchange suffered a brutal June, with the TA-125 down roughly 10.5% month to date and the TA-90 off nearly 11%, after the June 14 US-Iran memorandum of understanding deflated the wartime rally that had made TASE one of the world's best performers. Defense, banking, and energy names led losses, with the defense index off 25% over three months as investors priced in a smaller security premium. Israeli investors, unlike cheering Wall Street, read the Washington-brokered framework as a strategic letdown that preserves the Iranian threat rather than dismantling it. Year to date, the TA-125 remains up over 31%, a reminder that Israel's economy proved its resilience through the longest war in its history. The shekel held steady near 2.91 to the dollar, signaling that the selloff reflects repricing rather than capital flight.
Sources:(1)(2)(3)(4)(5)Smotrich pledges shekel-relief package as currency hits 33-year high vs dollar
Finance Minister Bezalel Smotrich said an assistance package for Israeli high-tech firms harmed by the strong shekel will be unveiled 'in the coming days,' as the currency trades around NIS 2.90 to the dollar, its strongest level since October 1993. Tech founders, who book revenue in dollars but pay salaries and rent in shekels, report that 2026's $8.6 billion in startup raises is worth roughly 20 percent less in local-currency terms than the same fundraises a year ago. Among proposed measures: allowing multinationals such as Nvidia and Microsoft to pay certain corporate taxes in dollars rather than converting to shekels. The IMF still projects 3.5 percent Israeli growth this year, well ahead of the US (2.3 percent) and EU (1.3 percent), underscoring that the strong shekel reflects underlying economic resilience even amid war.
Sources:(1)(2)(3)(4)(5)Israel Innovation Authority expands Startup Fund for early-stage DeepTech
The Israel Innovation Authority announced upgrades to its flagship Startup Fund supporting Pre-Seed and Seed DeepTech companies. Maximum public co-investment rises from NIS 1.5M to NIS 2M at Pre-Seed and from NIS 5M to NIS 6M at Seed, with a six-month window for founders to close matching private capital. The changes, reflecting heavier capital needs of quantum, advanced-chip and autonomous-systems startups, take effect July 15, 2026.
Primary:(1)(2)Secondary:(3)(4)(5)Israel weighs landmark US IPOs for state defense champions IAI and Rafael
Bloomberg reported that Israel is considering listing 25-30% of Israel Aerospace Industries (estimated at NIS 100B / $33.7B) and Rafael Advanced Defense Systems (~NIS 60B / ~$20B) on a US exchange, with an Israeli delegation set to travel to Washington in mid-July to meet investors, underwriters and regulators. Both makers of Arrow and Iron Dome posted record 2025 results, with order backlogs exceeding $30B and $20B respectively. Foreign orders are 70% of IAI's total and roughly half of Rafael's, and a US listing could ease disclosure rules around classified projects compared with a Tel Aviv float.
Sources:(1)(2)Tourism rebounds with 1.3 million visitors in 2025
Israel recorded roughly 1.3 million tourist entries in 2025, up about 34-35% from 2024 but still far below prewar levels. The United States, France and the United Kingdom led inbound tourism, while Tourism Minister Haim Katz said Israel was entering 2026 as 'a year of recovery' for the sector.
Sources:(1)(2)AppsFlyer raises over $1B from Google, Meta, Unity and Moloco at $2.7B valuation
Israeli mobile attribution leader AppsFlyer announced a Series E round of more than $1 billion from four global ad-tech giants, Google, Meta, Unity and Moloco, at a $2.7 billion post-money valuation. The company has roughly 1,300 employees, about $500M in annual recurring revenue, is cash-flow positive, and serves over 15,000 brands worldwide. AppsFlyer says it intends to use the round to accelerate omnichannel measurement and agentic AI workflows ahead of a future IPO.
Sources:(1)(2)(3)May CPI falls 0.3% as annual inflation drops to 1.9%
Israel's Consumer Price Index fell 0.3% in May, a steeper decline than economists had expected, and annual inflation dropped to 1.9%. The monthly decline was led by cheaper household equipment and clothing, while the Bank of Israel's benchmark target range remained 1-3%.
Sources:(1)(2)Shekel strengthens toward NIS 2.90 per dollar, up over 8% YTD
The shekel traded around NIS 2.9030 to the dollar in late June, its strongest level since October 1993 and more than 8% stronger against the dollar since the start of 2026. Globes tied the move to institutional foreign-exchange sales, foreign-resident flows, global market performance and Israel's falling risk premium; the stronger shekel curbs imported inflation even as exporters warn about competitiveness.
Sources:(1)(2)Motorola Solutions to buy D-Fend Solutions for $1.5B
Motorola Solutions agreed to acquire Israeli counter-drone specialist D-Fend Solutions for $1.5 billion. D-Fend's field-proven technology is used by government, public-safety and enterprise organizations to detect, track and take control of unauthorized drones.
Sources:(1)(2)Israeli AI cyber unicorn Dream doubles valuation to $3B
Dream, an Israeli AI cybersecurity firm focused on government customers, raised $260 million at a $3 billion valuation. The company frames its platform around helping governments build and control sovereign AI cyber-defense systems.
Sources:(1)(2)14 Israeli firms named to global 'Rising in Cyber 2026' list
Israeli companies took nearly half the slots on the 'Rising in Cyber 2026' list, including Cyera, Grip Security, Island, Noma Security, Oligo, Orca Security, Token Security, Torq, Beacon, Clover, Descope, Echo, Terra Security, and Tonic AI. The report tied the momentum to growth in identity security, cloud-native application protection, data security and AI-related security, with the global cybersecurity market projected to reach roughly $250 billion by 2029.
Sources:(1)(2)Israeli startups raise $1.25B in April, led by Vast Data mega-round
Israeli startups raised more than $1.25 billion in April, the strongest April for funding since 2021, despite only nine funding rounds during a holiday-shortened month. The figure was driven overwhelmingly by Vast Data's $1 billion raise at a $30 billion valuation, while smaller AI-agent and cloud-security rounds rounded out the month.
Sources:(1)Q1 2026 banking earnings: Leumi tops sector with NIS 2.3B
Bank Leumi opened 2026 with what it described as the strongest results in Israel's banking system, posting Q1 net income of approximately NIS 2.3 billion ($742 million) and declaring a NIS 1.3 billion ($411 million) dividend. The bank reported 16.3% return on equity for the quarter.
Sources:(1)Karish gas field returns to full output after brief Iran-war pause
Energean's Karish offshore gas rig resumed production after being idle for 40 days during the war with Iran. Jerusalem Post reported that Karish was the last major Israeli gas field to restart, after Leviathan had resumed operations about a week earlier while Tamar continued operating throughout the war.
Sources:(1)(2)Decart raises $300M at $4B AI valuation, Nvidia leads
Tel Aviv-based Decart, founded by Unit 8200 veterans Dr Dean Leitersdorf and Moshe Shalev, raised $300M at a $4B valuation backed by Nvidia and Amazon. The startup builds AI 'world models' for real-time video and simulation generation — a strategic anchor in Israel's AI infrastructure stack.
Sources:(1)(2)(3)Israeli startups raise $1.15B in March, $3B+ for Q1
March 2026 marked the second consecutive billion-dollar funding month, capping a Q1 in which Israeli high-tech raised over $3B, a 34% increase year-over-year. Standout rounds: Oasis Security ($120M Series B for machine identity), ScaleOps ($130M at $800M valuation for AI compute optimization), and Wonderful (enterprise AI agents at $2B valuation).
Sources:(1)(2)(3)TA-125 hits record highs during Iran war
The Tel Aviv Stock Exchange continued setting records during the Iran war. JNS reported that the TA-125 Index climbed above 4,300 points on March 6, up more than 66% from the same time the previous year, as investors treated Israeli defense, technology and infrastructure exposure as strategic assets.
Sources:(1)(2)Israeli tech raises $775M in best February since 2022
Israeli startups raised approximately $775 million across 23 disclosed funding rounds in February 2026, the strongest February for venture funding since 2022. CTech reported that cybersecurity and AI infrastructure dominated the month, led by Tomorrow.io's $175 million round, Vega's $120 million Series B and several AI-data and security deals.
Sources:(1)Moody's lifts Israel outlook to Stable, projects 5% growth
Moody's upgraded Israel's Baa1 rating outlook from negative to stable, citing materially eased geopolitical risk after the Iran ceasefire and ongoing Lebanon/Gaza truces. The agency projected 5% Israeli GDP growth in 2026 on what it called a strong postwar rebound.
Sources:(1)(2)(3)Chevron greenlights $2B+ Leviathan expansion
Chevron and its Israeli partners, NewMed Energy and Ratio, reached a Final Investment Decision on expanding the Leviathan platform to roughly 21 BCM/year capacity. The project is slated to add three wells, subsea infrastructure and platform upgrades, with expanded facilities expected to begin operating toward the end of the decade.
Sources:(1)Torq becomes Israel's first 2026 unicorn after $140M round
Tel Aviv-based cybersecurity firm Torq, which automates security operations using AI agents, closed a $140 million Series D round at a valuation above $1.2 billion. Calcalist reported the round brought Torq's total funding to $332 million and made it Israel's first new unicorn of 2026.
Sources:(1)Tel Aviv Stock Exchange moves to Mon-Fri trading week
TASE began trading Monday through Friday on January 5, 2026, replacing the legacy Sunday-Thursday schedule to align more closely with global markets and attract foreign investors. The exchange said the change would make Israeli securities more accessible to overseas participants and bring local trading calendars into line with major markets.
Sources:(1)(2)Bank of Israel cuts rates to 4.0% as inflation moderates
Governor Amir Yaron's Monetary Committee voted to lower the benchmark rate by 25bp to 4.0%, the second consecutive cut, citing moderating inflation, a stronger shekel and improving labor-market data. The Bank of Israel forecast projected further cumulative cuts of 0.5 percentage points by the end of 2026 if geopolitical and fiscal conditions remain stable.
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