Israeli Company Nanox Shares Plummet Amid Business Model Shift and Financial Losses
Nanox, an Israeli developer of low-cost digital X-ray devices, experienced a dramatic collapse in its market value last week. On June 25, its shares dropped 50% on the Tel Aviv Stock Exchange, followed by a partial recovery of 25% the next day and a further 20% rise on Monday. Despite this volatility, the company’s valuation has plummeted from a peak of $3.5 billion to just $76 million. Recent financial reports revealed a quarterly loss of $14.3 million, a canceled revenue forecast, and a going concern warning. The primary issue was Nanox’s business model, which relied on supplying devices without upfront payment and charging only per scan, rapidly depleting its cash reserves.
In response, Nanox is shifting its strategy to selling machines directly rather than scans and is downsizing its loss-making factory in South Korea. The company plans to raise capital soon, with CEO Erez Meltzer optimistic about improved second-quarter results. Analyst Cantor Fitzgerald set a target price of $5 per share. Industry insiders compare Nanox’s situation to Nova, whose shares traded around $2 for years before reaching a $12 billion valuation, suggesting some investors are betting on a similar turnaround.
In related economic news, the Israeli Defense Forces signed a contract worth about 21 million shekels with Magos Radar Systems to supply hundreds of radar units for drone detection. These cost-effective radars provide rapid alerts against drones, including fiber-optic types used extensively in southern Lebanon, which evade traditional radio frequency detection.
Additionally, a government report revealed record revenues and profits for Israeli state-owned companies in 2025, driven mainly by defense industry contracts. Rafael Advanced Defense Systems and Israel Aerospace Industries topped the list, with average monthly salaries for executives reaching over 80,000 shekels. Planned IPOs for these companies could be valued at tens of billions of shekels, though regulatory issues remain unresolved.
Finally, Yaakov Atrachchi, CEO of Aura, a leading urban renewal company, criticized developers reopening contracts with residents and called for more financially capable companies to consolidate the sector. He forecasted a housing market rebound within a year, especially outside the Tel Aviv metropolitan area, following expected interest rate cuts.
