Israel's high-tech sector continues to expand

ISRAEL - In Brief 01 Jul 2026 by Sani Ziv
Recent data on high-tech services exports (April) and startup fundraising (June) suggest that Israel's technology sector continues to demonstrate resilience despite geopolitical challenges. Israeli startups raised approximately USD 8.45 billion during the first half of 2026, including a record USD 3.3 billion in June alone. Since 2016, monthly high-tech services exports have increased fourfold, from approximately USD 1.5 billion to nearly USD 6 billion today. The record fundraising in June was led by Appsflyer (USD 1.3 billion), Cyera (USD 600 million) and DriveNets (USD 410 million), with several other companies completing sizeable funding rounds. The continued inflow of foreign capital highlights investors' confidence in Israel's technology sector despite the challenging geopolitical environment. At the same time, high-tech services exports declined by 2.0% in April following an exceptionally strong 8.0% increase in March. On a year-over-year basis, however, exports increased by 15% to USD 5.9 billion. We view high-tech services exports as one of the best real-time indicators of overall economic activity in Israel. With nearly 80% of the industry's sales generated abroad, the continued expansion in exports despite stable employment points to rapid productivity growth, potentially reflecting the increasing adoption of AI technologies. From a macroeconomic perspective, the continued strength of the high-tech sector remains one of the key pillars supporting the Israeli economy. Strong exports and sustained foreign investment generate demand for shekels, support the current account surplus, boost tax revenues, and help explain the resilience of economic activity.

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