Nvidia nears $12.9 billion deal to buy open-source AI platform, Hugging Face, report says
Fortune Beatrice Nolan ● Covered by 4 sources
Nvidia is reportedly buying Hugging Face for $12.9 billion. That would put its chip empire right in the middle of open-source AI.
Based on reporting by Fortune, Beatrice Nolan — read the original for the full story.
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Nvidia is reportedly close to buying Hugging Face for $12.9 billion, according to The Information. If it happens, the deal would give Nvidia a bigger role in open-source AI just as those models are getting closer to the closed systems built by companies like Anthropic and OpenAI.
Hugging Face is best known as a place where developers store open-source AI models, benchmark results and training data. But it’s also part of the plumbing behind those models: people who download them usually need Nvidia GPUs to run them, whether on their own servers or through the cloud. Hugging Face itself uses Nvidia chips for its paid hosting services, which makes the fit between the two companies almost awkwardly neat.
That matters for Nvidia’s core business. Several big tech companies, including OpenAI, Google, Amazon and Anthropic, are building their own chips to cut dependence on Nvidia hardware. Owning Hugging Face could help keep more of the open-source AI world tied to Nvidia’s GPUs, while also giving Nvidia a way back into cloud computing after reportedly scaling that business back about a year ago.
There’s also a defensive angle. Hugging Face has become a key piece of the AI ecosystem, and Nvidia has already put tens of billions of dollars into its own open-source models. The acquisition could even help Nvidia shift around unused cloud capacity from customer deals it has already promised.
The reports are not settled yet. Business Insider said takeover talks were happening but had not produced a signed agreement and could still fail. The Information said an unnamed source described the deal as successful, but Fortune said it could not verify that independently.
Hugging Face last raised money in 2023 at a $4.5 billion valuation, after a $235 million round led by Salesforce Ventures. It also turned down a $500 million Nvidia investment last year that would have valued it at $7 billion, reportedly because it didn’t want one dominant backer. The 10-year-old company says it is nearing profitability, with revenue around $150 million a year.
My take — AI-written commentary, not fact-checked reporting
This is what AI concentration looks like when nobody says the quiet part aloud: even the open-source side ends up orbiting the same hardware giant. Nvidia doesn’t just want to sell picks and shovels; it wants the mine, the road to the mine, and the coffee stand outside the mine. That’s not openness, that’s a very expensive dependency with better branding.
Read more about this at: Fortune
