Nvidia has reportedly agreed to buy Hugging Face, the open-source AI platform used by millions of developers to share and download models, for $12.9 billion. If it closes, it would be the largest acquisition in Nvidia's history bigger than its $6.9 billion purchase of Mellanox in 2020 and it would mark a striking evolution in how the world's most valuable chipmaker thinks about its own business.
From investor to owner
This isn't Nvidia's first attempt to get closer to Hugging Face. Nvidia backed the company in its 2023 Series D round, which valued Hugging Face at $4.5 billion and also included Salesforce, Google, Amazon, and IBM as investors. Last year, Nvidia tried to go further, offering roughly $500 million for a bigger stake that would have valued Hugging Face at around $7 billion. Hugging Face turned that offer down, reportedly because it didn't want a single investor especially one as dominant as Nvidia to have outsized influence over its direction.
An outright acquisition changes that calculus. Rather than ceding partial control while still needing to satisfy one powerful backer, Hugging Face would become part of Nvidia entirely. The new price tag, nearly triple the 2023 valuation, also reflects how central the platform has become to the AI ecosystem: Hugging Face now hosts models and datasets used by more than 13 million developers, and its revenue has grown quickly, reportedly climbing from around $100 million to $150 million in just a couple of months this year.
Why Hugging Face matters to Nvidia's business
Nvidia's dominance rests on selling the chips that train and run AI models. Hugging Face doesn't compete with that business it reinforces it. The platform is where much of the open-source AI world lives: researchers and companies upload, share, and fine-tune models there, and a large share of that activity runs on Nvidia GPUs, including the paid hosting services Hugging Face sells directly to developers.
A thriving open source ecosystem gives AI developers an alternative to closed labs like OpenAI and Anthropic, and keeps that activity tied to Nvidia's hardware rather than a rival's. Owning the platform where that ecosystem congregates would let Nvidia influence and directly monetize a layer of the AI stack it doesn't currently control.
The deal would also mark Nvidia's return to cloud computing, a business it had reportedly scaled back roughly a year ago. Hugging Face's hosting infrastructure could give Nvidia a channel to offload unused cloud capacity from the massive computing commitments it has guaranteed to customers.
Part of a bigger pattern
The potential purchase fits a broader trend of Nvidia spending aggressively to shape the AI landscape around itself. The company has poured more than $40 billion into AI-related equity deals in 2026 alone, including a reported $30 billion stake in OpenAI and a $20 billion licensing deal with chip startup Groq. Critics have described this web of investments as "circular financing" Nvidia funding companies that then use that money to buy Nvidia chips a characterization CEO Jensen Huang has publicly rejected as "simply ridiculous."
Buying Hugging Face outright is a different kind of move: it's Nvidia acquiring infrastructure rather than simply funding a customer. It also lines up with public comments Huang made just a month before the reported deal, when he defended open-source AI models, writing that they "strengthen safety and cybersecurity, accelerate innovation and diffusion, and enable sovereignty."
Where things stand
As of this writing, the deal has not been officially confirmed by either company. The Information first reported that Nvidia had agreed to the acquisition, and the figure has since been corroborated by CNBC, TechCrunch, Fortune, and other outlets. However, Business Insider has reported that talks were still ongoing as of the weekend and that no signed agreement had been finalized, meaning the deal could still change or fall apart. Both Nvidia and Hugging Face have declined to comment publicly.
If the acquisition does go through, industry watchers expect Hugging Face's core products to remain free and open source at the license level, even as its underlying infrastructure gradually shifts toward Nvidia hardware. The deal is also likely to intensify scrutiny of how much of the AI industry's critical infrastructure — chips, cloud capacity, and now potentially the software layer where models are shared — is concentrated under a single company.