Nvidia has reportedly struck a deal to buy open-source AI company Hugging Face for $12.9 billion. If it goes through, the chipmaker could soon be steward to a millions-strong community of AI developers.
Founded in 2016, Hugging Face originated as a chatbot app for teenagers before shifting its focus to machine learning. It now maintains a large repository of open-source AI models, datasets, and tools contributed by users, stating that it is “on a mission to democratize good machine learning” (emphasis original). According to Hugging Face, its platform had 13 million users and over 500,000 public datasets last year, and hosts over 3 million models as of last week.
Now, The Information reports that Hugging Face has reached an agreement to sell to Nvidia, citing sources close to the matter. This partially corroborated a weekend report from Business Insider that Hugging Face was considering an acquisition valued at around $13 billion.
Hugging Face previously rejected Nvidia’s $500 million investment offer
This isn’t the first time Nvidia has expressed interest in Hugging Face. The chipmaker previously invested in Hugging Face’s Series D funding round in 2023, contributing to the $235 million raised from companies such as Google, Amazon, and Salesforce. At the time, Hugging Face was valued at $4.5 billion.
According to a Financial Times report, Nvidia subsequently made a $500 million investment offer to Hugging Face late last year, but it was rejected. Though Hugging Face did not comment specifically on Nvidia’s proposal at the time, it reportedly said it didn’t want a single dominant investor that might sway decisions. The deal would have valued Hugging Face at $7 billion.
Hugging Face cofounder Thomas Wolf declined to comment on the rumored sale to Nvidia during a Thursday interview with Bloomberg Tech. However, when asked whether he or fellow co-founders Clément Delangue and Julien Chaumond are considering selling more broadly, Wolf stated that Hugging Face has “always had a lot of interest.”
Mashable has reached out to Nvidia and Hugging Face for comment.
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Hugging Face users react with both wariness and nonchalance
Users of the Hugging Face platform have reacted to the news of Nvidia’s potential takeover with a mix of wariness and detachment. Some have said the deal “screams monopoly,” expressing concern that Nvidia could censor the repository, or use it to exert control over developers and snuff out competition.
“It isn’t about a ‘return on investment’ in the traditional sense, but about control,” Reddit user r/4gotmipwd said about the acquisition. “They’re paying for the power to use it as a weapon against others, or destroy it if it threatens their position.”
Others believe Nvidia won’t make such significant changes, as it would make HuggingFace less competitive. If Nvidia does go that route, users can simply jump ship to another platform.
“I’m not too worried as long as USA users can access ModelScope,” wrote r/DistanceSolar1449. “I don’t see Nvidia deleting a model from as long as ModelScope exists.”
“Nvidia has a vested interest in open source AI models,” said r/CommanderKoba. “The profit motive behind their company incentivizes a free, open platform for the exchange of these models, because they sell the hardware.”
“Nvidia’s whole strategy right now is pumping open source models so that private labs are commoditized, meanwhile there are dozens of inference providers all buying Nvidia to serve tokens,” r/jebuizy wrote. “Will it work? Who knows, but their incentives are definitely aligned with bolstering open source models right now.”
Nvidia’s Q2 2027 results show benefits from AI boom’s impact still increasing
Nvidia did not mention Hugging Face when releasing its Q2 results for the 2027 financial year on Wednesday. However, the chipmaker announced that it had hauled in $96.2 billion in revenue in just three months, an 18 percent increase over Q1’s $81.6 billion. This, in turn, was a 20 percent increase over the previous quarter, as Nvidia continues to profit from increased demand driven by the AI boom.
It isn’t expecting this to fall off any time soon, either, with Nvidia continuing to grow even after the U.S. government policies cut it off from the significant Chinese market.
“Last year, one of the funnest things to do is just to go figure out where I go for dinner and who I have dinner with, and their stock price doubles the next day,” NVIDIA CEO Jensen Huang said during this week’s earnings call.
Hugging Face is a privately held company, so it does not have public shares. However, Nvidia’s own stock did jump significantly in the wake of this week’s news, surging 8.74 percent by the end of trading on Thursday.