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Nvidia to Acquire Hugging Face for $12.9 Billion, The Information Reports

Nvidia has agreed to acquire AI model repository Hugging Face for $12.9 billion, according to The Information, a deal that would place the largest open-source AI platform under Nvidia's control.

AI News Feed · 2026-08-28 12:32

Hugging Face, founded in New York in 2016, started as a chatbot app before pivoting to hosting open-source models and datasets. It now hosts more than 3 million open-source models and over 1 million datasets, earning it the nickname "the GitHub of AI." The reported acquisition price is nearly three times the company's $4.5 billion post-money valuation in its 2023 Series D round. Business Insider reported that Microsoft also held talks with Hugging Face but failed to reach a deal.

The acquisition would mark a reversal from Hugging Face's previous stance. According to the Financial Times, in late 2025 the company rejected a $500 million investment from Nvidia at a $7 billion valuation, saying it did not want a dominant investor that could influence its decisions.

Nvidia's financial capacity makes the $12.9 billion price tag relatively modest. In its latest fiscal second quarter, the company reported revenue of $96.221 billion, up 106% year over year, and net income of $59.688 billion. Its market value rose by about $442 billion in a single day after the earnings release, reaching approximately $5.49 trillion.

The acquisition fits Nvidia's strategy to strengthen its position in the AI ecosystem. As companies like OpenAI, Google, Amazon, and Anthropic develop their own AI chips to reduce dependence on Nvidia, a thriving open-source ecosystem provides an alternative for customers and keeps compute demand on Nvidia hardware. Nvidia has already invested billions in open-source AI models, and CEO Jensen Huang recently started a Twitter account to voice support for open source.

The Information noted that Nvidia scaled back its DGX Cloud initiative about a year ago. Hugging Face helps developers run models on rented compute. Acquiring it could also serve as a financial hedge: Nvidia has committed to absorbing billions in cloud computing contract costs for customers, and idle capacity could be sold to Hugging Face's users.

The move underscores Nvidia's growing commitment to open-source AI and its ambition to become a leading provider of open-source AI technologies in the United States.