source: Variety
Nvidia has agreed to acquire open-source AI platform Hugging Face for $12.93 billion, as reported by CNBC and confirmed Thursday by Nvidia chief executive Jensen Huang in a blog post.
The deal is the chipmaker’s second-largest on record, behind the $20 billion purchase of Groq assets in December 2025.
What makes the origin of this deal unusual: Hugging Face made the first move.
Hugging Face co-founder and CEO Clément Delangue told CNBC that he approached Huang over the summer after concluding that open-source AI had reached a turning point and needed more resources, greater scale, and wider visibility.
Delangue said Nvidia felt like a natural home, and negotiations moved quickly from there.
How the Deal Is Structured
Under the terms, Nvidia will pay roughly $11.9 billion to existing Hugging Face investors, with up to $1 billion set aside as an equity-based retention package for employees who join Nvidia, according to Reuters.
The price represents a dramatic premium over Hugging Face’s last known valuation of $4.5 billion, set during its 2023 Series D funding round.
At roughly 86 times annual revenue, the acquisition reflects Hugging Face’s strategic weight rather than its current profitability — the company has not yet turned a profit.
Hugging Face, founded in New York in 2016 by French entrepreneurs Delangue, Julien Chaumond, and Thomas Wolf, hosts more than 3 million AI models, 500,000 datasets, and 1 million applications.
Around 18 million developers and researchers use the platform, and some 200,000 companies rely on it for their AI workflows.
Nvidia’s Open-Source Strategy
Huang has been vocal about open-weight AI models and recently co-signed an industry letter making the case for their role in broadening access to the technology.
Nvidia is already the platform’s largest contributor of open models, having published more than 500 models and 250 datasets on Hugging Face.
Huang said Nvidia’s hardware will not be a requirement to build or deploy through Hugging Face. The platform will continue to support a range of clouds, accelerators, and model builders, he said, and will keep its familiar brand identity intact.
The Pressure Behind the Purchase
As Ars Technica noted, Nvidia’s biggest customers, including Meta, Microsoft, and OpenAI, have begun developing their own chips to reduce their dependence on Nvidia’s GPUs.
Acquiring Hugging Face gives Nvidia a stake in the open-model ecosystem at a moment when demand for lower-cost, open-weight alternatives has surged, partly driven by Chinese labs such as DeepSeek and Z.ai. The deal is also consistent with Nvidia’s broader platform strategy, which previously expanded into networking with Mellanox and AI orchestration with Run:ai.
Hugging Face was also previously the target of interest from Salesforce, and had received investment from Google, Microsoft, AMD, Intel, and Amazon before the Nvidia acquisition was agreed. Nvidia shares were slightly lower on Thursday following the announcement.