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Apple's roaring chip business has a new M&A target, executive says: Israeli start-ups

Jason Gewirtz
Johny Srouji, Apple's senior vice president of hardware technologies, spoke to Hebrew daily business paper Calcalist.

The boss of one of Apple's hottest units — chips — said this week that the iPhone maker is eyeing Israeli technology, specifically around flash storage and sensors.

Israel could be a target for an Apple acquisition "because we have to have the best technology to differentiate ourselves," Johny Srouji, Apple's senior vice president of hardware technologies, told Hebrew daily business paper Calcalist. "We don't make buys to increase workforce and to obtain new talented workers, we do it for the technology."

Srouji said that it doesn't necessarily matter if Apple acquires start-ups in Israel or elsewhere, as long as the technology is innovative. But he said Apple's Israeli team is already involved "in all areas and new devices including the development of a new chip."

Chips and processors are becoming increasingly important for Apple, as the company makes more and more custom sensors to keep up with cutting-edge software capabilities like augmented reality. Apple chief financial officer Luca Maestri said earlier this year that in-house development of chips was a main source of Apple's exploding research and development spending.

Srouji told Mashable in September that chip design is a 3-year process that is integral to deciding the features, like Face ID, and even the design, that will be possible on future devices.

"Purchasing [M&A] for us is a way to innovate. We need to own the entire system, software and hardware, battery and the materials," Srouji told Calcalist.

For more on the story, see the original report.