Nvidia Conceals Then Reveals Israeli Revenue Details Amid Record Growth
In recent years, Nvidia has detailed its revenue breakdown across product lines, allowing observers to track sales of its graphics processors for gaming and its server products, including AI processors and communication processors. The communication processors largely stem from Nvidia's 2019 acquisition of Israeli company Mellanox, with key products like the NVLINK network managed from Israel. However, two quarters ago, Nvidia decided to merge sales data of communication processors with graphics processors into a single unit, effectively obscuring the ability to track Israeli operations separately.
In the first quarter of 2026, Nvidia announced this change but still presented the original breakdown, showing Mellanox products as the fastest-growing division, accounting for 18% of total company revenue, nearly $15 billion for the quarter. This figure was so significant that Israel's Central Bureau of Statistics (CBS) credited it with contributing to Israeli GDP growth. By the second quarter, the separate data disappeared from reports, combined with GPU sales to Nvidia customers.
Despite this, during the investor call, Nvidia's CFO disclosed that communication processor sales grew 18% quarter-over-quarter, suggesting Israeli revenue reached approximately $17.5 billion in Q2, maintaining the 18% share of total sales. CFO Colette Kress highlighted that the "Spectrum-EX" communication switch, based on Ethernet protocol, saw annual sales multiply by 2.6 times, making Nvidia the fastest-growing communications company worldwide. Spectrum-EX enables faster data transfer between GPUs, enhancing AI processing capabilities.
This performance reinforces Nvidia Israel's position as the country's highest-earning company. For comparison, Teva Pharmaceuticals earned $4.1 billion in Q2, and Check Point Software reported $674 million. Other Israeli defense companies like Israel Aerospace Industries and Elbit Systems reported combined revenues of around $4.2 billion and $2.2 billion respectively for the first half of 2026.
According to CBS export data, "exports not crossing Israeli borders," mostly attributed to Nvidia and to a lesser extent to companies like Camtek and Nova, have consistently been about $2 billion per quarter. Last year saw a 74% increase compared to 2024, with growth of $7 billion. In Q1 2026 alone, this figure rose to $8 billion. Without Nvidia and similar companies, Israel's economy would have contracted by 5.8% in Q1 instead of the actual 2.2% decline. For the full year 2025, Israeli GDP grew 3.5%, but without Nvidia, growth would have been only 2.1%. Economist Prof. Benjamin Bental noted that excluding Nvidia, growth was 5.5% year-over-year, compared to 7.2% including the company, adding 1.7 percentage points to growth.
Nvidia's evolving reporting practices and its significant economic impact highlight the company's critical role in Israel's high-tech sector and national economy.
