Microchip Technology, the Chandler, Arizona-based chip company, signed a definitive agreement to acquire Hailo, an Israeli maker of edge AI processors and vision chips. Microchip announced the deal on July 24, 2026.
The purchase price and other terms were not disclosed. Microchip said it did not expect the acquisition to have a material impact on its financial results. The deal was expected to close toward the end of the quarter ending September 30, 2026, subject to customary conditions and regulatory approvals.
Hailo's products and developer community are set to become part of Microchip's processing portfolio for edge systems. Microchip did not say how many Hailo employees would join.
What Hailo built
Hailo was founded in 2017 by Orr Danon, Avi Baum and a group of alumni of the Israeli military's Unit 81 technology unit. It designs processors that run AI models on devices rather than in data centres. Its product families are the Hailo-8 and Hailo-10 accelerators and the Hailo-15 vision system on chip.
The chips cover a range from edge servers running local generative and multimodal AI workloads to low-power vision processing inside small standalone cameras. They support convolutional neural networks, transformers and large language and vision-language models, along with image signal processing, video encoding and AI video stream processing.
According to Microchip, Hailo had more than 100 customers and a developer community of more than 10,000 users, supported in part by the Raspberry Pi ecosystem. Calcalist reported in June that Hailo's accelerators had sold more than 500,000 units.
“The acquisition of Hailo accelerates Microchip's expansion into high-performance edge AI processing.”
From unicorn to distressed sale
Hailo raised about $340 million after its founding. In 2021 it raised $136 million at a valuation of about $1 billion. In April 2024 it added a $120 million Series C extension at a $1.2 billion valuation, led by the Zisapel family, Alfred Akirov and Gil Agmon.
The following two years were harder, with Calcalist reporting liquidity pressure and emergency financing. A planned merger with a special purpose acquisition company, which would have valued Hailo well below its earlier rounds, fell through. In January 2026 Delek Automotive, which held 12.1% of the company, lent Hailo $9 million at 1.5% interest per month, rising to 3% if no liquidity event took place within a year.
Hailo cut about 10% of its staff in January 2026. On June 8, 2026, it said it would cut about half its workforce, about 110 of 220 employees, and refocus on physical AI markets such as robotics and drones. At the time it was looking for a merger or a sale to investors or strategic buyers.
Microchip's announcement did not discuss this history. In a report published after the deal, Calcalist said Hailo had been sold at a price significantly below the total capital it had raised, and that much of the value built for shareholders had been lost.
Why Microchip is buying
Microchip sells microcontrollers, FPGAs, connectivity, security, power and analog chips used in industrial and embedded systems. It said Hailo would add power-efficient AI acceleration for robotics, advanced vision, drones, smart cameras, industrial automation and embedded AI.
The company also pointed to Hailo's developer community as a source of future customer pipeline. The deal builds on Microchip's earlier purchase of Neuronix AI Labs, which added neural network optimisation technology for FPGAs and systems on chip.
Hailo chief executive Orr Danon said Microchip's customer reach, sales channels and broader product range would help Hailo bring its vision processing and AI acceleration to more edge applications.
A hard market for AI chip startups
Hailo is one of several Israeli technology companies that sold in 2026 for less than they had raised. Calcalist grouped the deal with Razer's purchase of StreamElements, saying both buyers saw a chance to acquire technology and experienced teams at low prices, while investors who entered at high valuations lost much of their money.
Microchip's announcement did not say whether the Hailo brand and product names would be kept after closing.
