Nvidia Set to Acquire Hugging Face for $12.9 Billion, Boosting AI Dominance

Nvidia has agreed to buy Hugging Face, a leading open-source AI model repository, for $12.9 billion, according to The Information.

This deal marks a significant shift in Nvidia's strategy, as it seeks to bolster its position in the rapidly growing AI market. For related coverage, explore our detailed analysis on Technology and Digital Systems.

Nvidia Closes Hugging Details and Timeline

Hugging Face, founded in 2016, is a popular platform where developers share and download open-source AI models.

The acquisition would give Nvidia a strong foothold in the world of open-source AI, which has been gaining traction as companies like Anthropic and OpenAI build their own closed AI systems.

Nvidia's dominance in AI chips is already under threat, with many major closed-source AI labs building their own hardware to reduce their reliance on Nvidia's components.

Nvidia Closes Hugging Next Steps and Impact

The deal also marks a comeback for Nvidia in cloud computing, as the company scales back its DGX Cloud business and looks to regain traction in the sector.

Hugging Face's growth has enabled it to reach profitability, with revenue of around $150 million per year.

However, the acquisition price of $12.9 billion represents a significant multiple for a company of this size, raising questions about whether Hugging Face is willing to accept such a large sum.

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The deal also gives Hugging Face access to Nvidia's deeper pockets, which could help it navigate an increasingly competitive AI infrastructure market.

Other major players in the AI space, including Stripe and OpenRouter, have been valued at billions of dollars in recent rounds, further underscoring the importance of this acquisition for Nvidia.

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Nvidia has concurred to buy Hugging Face for $12.9 billion, The Information reported Wednesday night, citing a source familiar with the matter. Business Insider, which first reported over the weekend that Hugging Face was fielding takeover interest, reported Wednesday night that the talks — which would value the company at more than $13 billion — had not yet produced a signed agreement and could still atomize.

TechCrunch reached out earlier to both Nvidia and Hugging Face for comment, and neither has yet responded. (Nvidia’s silence is particularly noteworthy here as the company has moved quickly in the past to address reports it considers inaccurate.) Maybe it was destined from the start.

Hugging Face, founded in 2016, is one of the most popular hubs where developers share and download open-source AI models. Buying it would give Nvidia a strong foothold in the world of open-source AI, right as open-source developers are doing their level best to catch up to closed AI systems from companies like Anthropic and OpenAI.