Nvidia acquires open-source platform Hugging Face for nearly $13 billion

Nvidia has officially announced its intention to acquire the AI platform Hugging Face for $12.9 billion. The move represents the chipmaker's shift beyond focusing solely on hardware.

Nvidia CEO Jensen Huang stated that after the acquisition, Hugging Face will remain an "open platform for the entire AI ecosystem." In a post he published, he added that Nvidia will help empower the platform to "strengthen infrastructure and expand access to AI for developers and institutions around the world." This means that the more than 18 million developers using the platform will be able to choose which models, cloud providers, and chips to use.

This is the second most expensive acquisition in Nvidia's history, after it paid $20 billion in December for assets of the chipmaker Groq. Another major deal for the company was the acquisition of the Israeli company Mellanox in 2019 for $7 billion, which formed the basis for Nvidia's transition beyond chips to infrastructure for data centers.

Nvidia is the world's most valuable company, with a market cap of $5.4 trillion, thanks to high demand for its AI chips. Last week, it reported a 106% jump in revenue in the second quarter compared to the same quarter last year, reaching $96.2 billion, and net profit jumped by 126% to $59.7 billion.

Hugging Face, founded ten years ago, serves as a repository for millions of AI models and datasets and is one of the companies most identified with the promotion of open AI systems. It recently made headlines following an AI agent hacking incident, which raised concerns about the rapid development of the technology and its exploitation for cyberattacks. During the incident, advanced OpenAI models breached the platform's computing systems.

"It is an honor that Hugging Face CEO Clement Delangue approached me when he was considering the next stage of the company and believed that Nvidia would be an excellent home for the company, its community, and the future of open models," Huang concluded.

Nvidia hopes to complete the acquisition in 2027, but it must win approval from antitrust authorities. Hugging Face, named after the hugging emoji, has previously raised capital from Nvidia as well as Google, Amazon, and Intel. However, last year it rejected a $500 million investment from Nvidia, claiming it wanted to maintain its independence.