The Israeli FinTech company Nayax, dually listed in New York and Tel Aviv with a market cap of 6 billion shekels, has announced a significant workforce reduction: the company will lay off 70 employees, 55 of whom are in Israel. This marks Nayax’s first major round of layoffs since its establishment in 2005. The move comes despite an impressive 49.63% surge in Nayax’s stock year-to-date on the Tel Aviv Stock Exchange (compared to a 28% increase in the TA-125 index in which it is included), and an even more significant 67.24% increase on the Nasdaq over the same period. Nayax, which operates in 11 global locations and employs 1,200 people, half of whom are in Israel, stated that “this measure stems from the need to streamline the company’s structure following its expansion in recent years, including acquisitions it has made, which created overlaps in certain roles – and as a continuation of responsible expense management, and maintaining an efficient operational structure.”

Nayax, led by its founding CEO Yair Nahmad (who holds 23% of the company’s shares, alongside his brother Amir, who holds 19%, and David Ben Avi, another founder, who also holds 19%), specializes in the development and sale of digital products, primarily for self-service automated vending machine points of sale. Nayax’s revenues in 2024 totaled 1.1 billion shekels, compared to 850 million shekels in 2023, and its annual net loss significantly narrowed to 20.5 million shekels, compared to a 58 million shekel loss in 2023. In the first quarter of 2025, the company even recorded record profits of 26 million shekels.

Growth Strategy Through Acquisitions and the Need for Streamlining

Nayax’s rapid growth in recent years, as reflected in its revenue figures and improved profitability, has partly been driven by an aggressive acquisition strategy. In July 2021, the company acquired Weezmo; in January 2022, On Track Innovations; in April 2024, Roseman, which deals with gas station management systems; and in May 2024, Brazilian VMtechnologia, also active in the automated self-service sector. These acquisitions, which enabled Nayax to expand its market share and product/service portfolio, simultaneously created overlapping roles and “points of inefficiency” in workflows, as explained by the company.

Company management states that the layoffs are a “continuation of responsible expense management, and maintaining an efficient operational structure.” In an email sent to company employees, the founders noted that “as part of the continued integration of teams and workflows, we identified significant opportunities to improve productivity and reduce operational expenses. These steps are essential for building an agile, focused, and high-performing organization – one that is well-prepared to meet our profitability targets and sustain long-term growth.” They added that they reviewed workflows between departments and identified “points of inefficiency,” and therefore they are implementing better working methods for faster execution. This streamlining, even if painful in the short term for the laid-off employees, is intended to ensure the company’s continued growth and profitability in the long run within a competitive business environment.

The Leverage Behind the Move: Profitability Versus Workforce Reduction

The layoffs at Nayax come despite a series of positive financial data presented by the company, including a significant reduction in losses and even record profits in the last quarter. This dissonance, between revenue growth and improved profitability on one hand and workforce reduction on the other, points to a broader trend in the technology industry, where companies are increasingly focusing on operational efficiency and increasing profit margins, even as they continue to grow. Nayax’s explanation, that the layoffs stem from overlapping roles created by acquisitions, is reasonable in the context of a rapidly growing company driven by mergers and acquisitions (M&A). When one company acquires another, there are often redundant roles or departments with overlapping functions, and their integration requires reduction.

However, the move raises questions about the nature of FinTech growth today: is it characterized more by automation and streamlining, and less by new job creation? In Nayax’s case, it appears that management is choosing a path where a “culture of cost awareness” and “calculated and strategic resource allocation” become guiding principles. This is an approach that seeks to maximize profitability from every shekel of revenue and build an “agile, focused, and high-performing organization” ready to meet aggressive profitability targets.

Implications for Nayax and the Israeli and Global Labor Market

The layoff decision at Nayax, particularly its scope in Israel (55 out of 70 employees), indicates a broader trend in the local and global technology market. After years of accelerated growth and extensive hiring, many tech companies, including FinTech firms, are now focusing on “streamlining” and “cost awareness.” This is a natural stage in the maturation of the technology industry, especially in an environment of higher interest rates and investor demands for clear profitability.

For Nayax, the move, despite its human difficulties, is intended to strengthen its financial position and enable it to continue growing and competing in the global market. The company’s ability to demonstrate consistent profitability, alongside continued revenue growth, will be crucial for a positive impact on stock value and long-term investor confidence. For the Israeli labor market, the layoffs at Nayax join other signals indicating a moderation in demand for tech workers, although it remains a relatively strong market. Nayax’s action serves as a reminder that even successful and growing companies sometimes need to make painful adjustments to secure their financial future.