Formula Systems

What Formula Systems does

Formula Systems (1985) Ltd. is an Israeli information-technology holding company founded in 1985 and headquartered in Or Yehuda, listed on both Nasdaq (FORTY) and the Tel Aviv Stock Exchange ((1985)). The company does not itself develop a single product platform; instead it operates as a diversified parent whose revenues flow through majority-owned and minority-held operating subsidiaries. Core operating subsidiaries include Matrix IT Ltd., an IT services firm, and Magic Software Enterprises Ltd., which provides enterprise software and middleware, each of which contributed to the FY2025 reported revenue of $2.63 billion. Formula also retains an 18.68% stake in Sapiens International Corporation (insurance software), following Advent International's December 2025 take-private at approximately $2.5 billion, and a 33.08% stake in TSG IT Advanced Systems Ltd. The company is led by CEO Guy Bernstein and CFO Asaf Berenstin.

The business model is enterprise IT services and software, delivered through a horizontal segmentation approach to enterprise clients globally. Revenue is described as deriving from software services, enterprise automation solutions, and subscription/recurring arrangements at the subsidiary level; pricing specifics are not publicly disclosed. Go-to-market is characterized as enterprise field sales, with no productized consumer or self-serve channel publicly disclosed. The February 2026 reverse triangular merger of Matrix IT and Magic Software — both previously Formula subsidiaries — consolidated the two operating engines into one entity operating across 50 countries, serving more than 6,000 customers, and employing over 15,000 people. Pro forma combined market valuation of the merged operating entity is approximately $3.5–$4 billion, and pro forma revenues are approximately $2.4 billion.

Recent corporate actions have materially reshaped the portfolio. In December 2025, Advent International completed its acquisition of Sapiens for ~$2.5 billion in cash at $43.50 per share (a 64% premium), generating a roughly $570 million capital gain for Formula while leaving it with a retained 18.68% stake. In February 2026, Matrix IT and Magic Software completed their reverse triangular merger, with Magic shareholders receiving 31.1% of the combined entity and Magic delisting from Nasdaq and TASE. The Formula board subsequently approved a $200 million special cash dividend distribution. Underlying portfolio companies have remained active in capital raising and bolt-on M&A (e.g., TSG's January 2026 $58.9 million private placement and March 2026 acquisition of Mabat 3D), suggesting continued roll-up activity within the broader Formula orbit.

Name

Formula Systems

Legal name

Formula Systems (1985) Ltd.

Website

https://formulasystems.com

Company type

Public

Founded year

1985

Operating status

Operating

Headcount range

501–1,000 employees

Short description

Formula Systems (1985) Ltd. is an Israeli IT holding company operating through subsidiaries that deliver software services and enterprise automation to enterprise clients globally; its combined Matrix IT and Magic Software entity serves 6,000+ customers across 50 countries.

Ownership category

akta.pro rank

Product category

IT Services

NAICS

Software Publishers (5132), Computer Systems Design and Related Services (54151), Custom Computer Programming Services (541511)

SIC

Services-Computer Integrated Systems Design (7373), Services-Computer Programming, Data Processing, Etc. (7370), Services-Prepackaged Software (7372)

akta.pro industry

PRIMARYHDAEAHAF

Digital Process Automation (DPA) & Orchestration Suites

Hardware, Technology & Telecom/Enterprise Platforms & Databases/Business Process Management (BPM), Workflow & Automation Platforms

SECONDARYHDAEALAF

IT Workflow Automation & Orchestration Platforms

Hardware, Technology & Telecom/Enterprise Platforms & Databases/Enterprise Service Management (ITSM/ESM) Platforms

SECONDARYHDAEAHAL

Compliance, GRC Workflow & Audit Automation Platforms

Hardware, Technology & Telecom/Enterprise Platforms & Databases/Business Process Management (BPM), Workflow & Automation Platforms

Keywords

• Enterprise IT services
• Software development services
• IT consulting
• Enterprise automation
• Technology solutions

Headquarters

HQ city

Or Yehuda

HQ country

Israel

HQ region

Middle East

Offices1 record

Markets served

GTM type

B2B

Offering type

Services

Cost components

Personnel, Operations, Technology or R&D, Marketing or Sales

Revenue model

1. Software Services and Enterprise Automation: Formula Systems generates revenue through its portfolio of IT services subsidiaries providing software services and enterprise automation solutions to enterprise clients globally.

Go-to-market motion1 record

Core offering

Formula Systems is a global IT holding company that provides software services and enterprise automation solutions through its operating subsidiaries, including Matrix IT Ltd. and Magic Software Enterprises Ltd. The merged entity operates in 50 countries, serves over 6,000 enterprise customers, and employs more than 15,000 people, delivering IT services, custom software development, and enterprise integration platforms.

Product overview

Formula Systems (1985) Ltd. is an Israeli IT holding company that operates through its subsidiaries including Matrix IT Ltd., Magic Software Enterprises Ltd., and previously Sapiens International Corporation N.V. The company completed a merger between Matrix IT and Magic Software in February 2026, creating one of the ten largest publicly traded IT services companies globally with approximately $2.4 billion in pro forma revenues. The company operates in 50 countries, serves over 6,000 customers, and employs more than 15,000 people. Formula Systems' portfolio companies provide IT services, software development, and enterprise solutions across various sectors.

Differentiator

Problem solved

Functional benefit

Products and services

• Matrix IT IT Services

Segments1 record

Ideal customer profiles1 record

Technology focussed Yes

API detail

Has API

No

API docs

API detail

Core technology

AI maturity

App detail

Partnerships

Two partnerships are on record, tiered core.

• Matrix IT Ltd.coreStrategic or Co-development Partner · 24 February 2026Matrix IT and Magic Software Enterprises, both subsidiaries of Formula Systems, completed their merger creating Israel's largest IT group with combined market valuation of approximately $3.5-4 billion. The deal was structured as a reverse triangular merger with Magic shareholders receiving 31.1% of the merged entity.
• Magic Software Enterprises Ltd.coreStrategic or Co-development Partner · 24 February 2026Matrix IT and Magic Software Enterprises, both subsidiaries of Formula Systems, completed their merger on February 24, 2026. Magic became a private company fully owned by Matrix and delisted from both NASDAQ and the Tel Aviv Stock Exchange. Magic shareholders received 31.1% of the merged entity.

Scale indicators11 records

Recent moves6 records

Expansion highlights5 records

Broad incumbents

• Accenture: Global IT services and consulting leader with $60B+ revenue serving enterprise clients across all major geographies. Comparable as the dominant public IT services peer against which Formula's $2.6B subsidiary footprint is benchmarked.
• IBM Consulting: Global technology and consulting giant with a large enterprise services and integration practice. Comparable as a broad incumbent offering enterprise IT services and automation at much larger scale, including direct overlap with Formula's integration business.

Direct peers

• Infosys: Large-cap global IT services firm providing application development, integration, and enterprise digital services. Comparable as a publicly traded IT services peer competing for similar enterprise transformation and automation engagements.
• Wipro: Global IT services and consulting company with broad enterprise software, integration, and digital transformation offerings. Directly comparable in scope, delivery model, and enterprise customer base.
• Cognizant: US-headquartered IT services company providing application services, digital transformation, and consulting to enterprise clients. Closely comparable in service mix, customer profile, and global delivery footprint.
• Tata Consultancy Services: Largest Indian IT services firm delivering application development, consulting, and digital transformation globally. Comparable in enterprise services depth and as a global scale competitor in the same IT services market.
• Capgemini: European-headquartered IT services and consulting company serving global enterprise clients with integration, application, and digital services. Comparable in scale and as a direct competitor for multinational enterprise transformation work.
• HCL Technologies: Global IT services company providing engineering, R&D, and enterprise application services. Comparable in scale, delivery model, and customer profile for global IT services engagements.
• Amdocs: Israel-based public company providing software and services for communications, media, and financial services providers. Comparable as an Israeli-headquartered enterprise software/services peer with overlapping customer verticals and delivery model.

Emerging players

• Globant: Latin American-headquartered IT services and digital transformation company providing application development and enterprise modernization. Comparable as a publicly traded IT services peer focused on digital engineering and enterprise modernization.

Market position

Strengths5 records

Weaknesses5 records

Competitive moat4 records

Key risks6 records

Key highlights6 records

Customer concentration

• LinkedInlinkedin.com/company/formula-systems-ltd

Revenue estimate

Valuation estimate

Number of profiles

Profiles2 records

Subsidiaries4 records

Funding overview

Funding rounds

Investors

Funding detail is available on the Subscription and Enterprise plan.Contact sales →

M&A3 records

Investments3 records

M&A and investment is available on the Subscription and Enterprise plan.Contact sales →

Frequently asked questions about Formula Systems