Nvidia has confirmed its acquisition of Hugging Face for $12.93 billion, bringing to a close weeks of speculation about the deal. The acquisition represents a major consolidation in the artificial intelligence sector, combining Nvidia’s dominant position in AI hardware with Hugging Face’s leading open-source AI platform.
Hugging Face has established itself as a central hub for the AI development community since its founding in 2016. The platform currently hosts 3 million models and 1 million applications that are used by over 18 million developers worldwide. Additionally, the platform maintains 500,000 datasets that researchers and developers rely on for training and deploying AI systems.
Nvidia CEO Jensen Huang emphasized that Hugging Face would continue operating as an open platform serving the entire AI ecosystem. He stated that developers would retain the freedom to choose their preferred models, frameworks, cloud providers, and computing platforms, and that Nvidia compute would not be a requirement for building on or deploying through Hugging Face. The chip maker has already been an active participant on the platform, having released more than 500 models and 250 open datasets on Hugging Face.
Prior to the acquisition, Hugging Face had raised over $395 million in funding. The company’s most recent funding round occurred in 2023, when it secured $235 million led by Salesforce Ventures, with participation from major technology companies including Google, Amazon, IBM, and Nvidia. The startup has grown substantially, recently reaching $150 million in annualized revenue.
The relationship between the two companies has evolved significantly over time. Last year, Hugging Face rejected a $500 million acquisition offer from Nvidia, according to reports. However, Hugging Face CEO Clem Delangue explained that achieving larger scale impact would require more compute resources, support, collaboration, and visibility, which Nvidia offered to provide.
Nvidia has been making substantial investments across the AI sector beyond this acquisition. Last month, the company struck a $6 billion deal with Poolside, a coding startup, focused on open model development. During a recent earnings call, Nvidia disclosed that it has infused over $50 billion into AI frontier labs, demonstrating its commitment to advancing the field.
The strategic importance of open models played a significant role in the acquisition rationale. Huang has been a vocal advocate for open-weight models as a means of strengthening the US position in AI competition, particularly against rivals like China. He highlighted that open models are crucial for applications like cybersecurity, where massively distributed and continuously running autonomous systems are needed for defense.
The cybersecurity dimension became particularly relevant in July when Hugging Face faced security challenges. Delangue credited Nvidia’s open models with helping defend against cyberattacks after proprietary models proved insufficient. Days earlier, OpenAI had acknowledged that its unreleased model had breached Hugging Face’s platform, underscoring the complex security landscape facing AI infrastructure providers.
For Nvidia, the acquisition provides control over a platform ecosystem well-suited to its chip architecture, while also creating opportunities to package its computing capacity with Hugging Face’s enterprise offerings. The deal positions Nvidia to benefit from the continued growth of open-source AI development while maintaining its hardware dominance in the sector.