Marvell lays off dozens in Israel as chipmaker adjusts engineering workforce
The company says the cuts reflect changing business needs and are limited to one team, rather than part of a global restructuring. Marvell employs approximately 500 people in Israel, where engineers have played a major role in developing its AI connectivity technology.
The American chipmaker Marvell is laying off dozens of employees in Israel, out of a local workforce of approximately 500. The cuts are not part of a company-wide round of layoffs, but rather a targeted decision affecting one of the engineering teams operating in the country.
Marvell's Israeli operations, which are spread across development centers in Petah Tikva and Yokneam, are built on a series of local companies the chipmaker has acquired over the years. The company has approximately 8,000 employees worldwide, and its Israeli centers are part of a unified global engineering organization. Its largest development center is in Santa Clara, California, while its second largest is in India. Its engineering centers in Israel are comparable in size to those in Vietnam and Singapore.
The company's global technology strategy is led by Israeli CTO Noam Mizrahi, who joined Marvell through its $2.7 billion acquisition of Galileo in 2000. Marvell subsequently expanded its Israeli presence through acquisitions including DSPC, acquired from Intel for $600 million in 2006, and RADLAN, acquired from the Rad-Bynet Group in 2007 for approximately $50 million. Mizrahi, who was appointed CTO in 2020, is the company's most senior Israeli executive and reports directly to CEO Matt Murphy.
Marvell specializes in connectivity chips and custom silicon for data centers, a market that has become increasingly important as AI infrastructure expands. In June, the company unveiled an optical communications processor for AI data centers. In an interview with Calcalist in June, Mizrahi explained that the growing number of processors used in AI systems has made connectivity a critical bottleneck, requiring increasingly sophisticated technologies to move data between chips.
Marvell has also secured major business agreements as it seeks to capitalize on the AI boom. In August, it signed an agreement to supply chips that work alongside Google's AI processors, a deal that could generate up to $120 billion in sales through fiscal 2033. Earlier this month, it announced an agreement to acquire optical components maker Lumentum in an all-stock transaction valued at $115 billion, including debt. The deal values Lumentum's equity at approximately $102.5 billion and is expected to close in the first half of 2028.
Marvell's market valuation surged last year, approaching $300 billion after Nvidia CEO Jensen Huang described it as the next company likely to join the "trillion-dollar club." Its shares have since retreated alongside other semiconductor stocks, amid growing investor concerns about the sustainability of AI infrastructure spending.
In response to the layoffs, Marvell said: "As part of an ongoing effort to align resources with changing business needs, we are reducing positions within one of our engineering teams."
The company said the changes affect only a limited portion of Marvell Israel's overall engineering organization. "Marvell has been operating in Israel for over 25 years and remains committed to continuing the expansion of its development centers in the country."
