Innovation and internationalization are key drivers of competitiveness and performance of business organizations. This study aims to investigate the manifestation of the “virtuous circle” innovation—internationalization and the mediating effect exerted by performance in this circle in business practice, based on the results of a statistical survey of affiliates of multinational companies and domestic companies operating in the ICT sector in Romania. Overall, the results of the study suggest that in both domestic and multinational companies there is a dynamic bidirectional relationship between innovation and internationalization, and part of this relationship is mediated by performance. The study broadens the area of knowledge primarily by exploring this virtuous circle in knowledge-intensive sectors such as ICT, where innovative activity differs from that in traditional industrial sectors. Although there is a quite vast body of literature on the topic, previous studies have focused almost exclusively on manufacturing sectors. Second, the study explores this relationship within the particular context of an emerging economy that has undergone a long and painful process of economic, social, and political adjustment and is looking for new drivers of economic growth. Thirdly, the comparative approach is likely to capture strategic elements in the behavior of multinational companies, which can become models of good practice for domestic companies. Therefore, the findings of the study have management implications at micro and macro level. Thus, the relationship emerging among innovation, internationalization, and performance may concern macroeconomic policymakers in support of sectors with significant growth potential such as ICT. At the same time, managers should consider the potential for increasing competitiveness, both directly and indirectly, that this virtuous circle entails.