Nvidia has agreed to buy Hugging Face, the developer platform often described as a GitHub for AI, in a deal valued at $12.93 billion. The acquisition, announced Thursday, ranks among Nvidia's largest ever and signals a major bet that open AI models will remain central to the industry, even as demand for its own chips shows signs of cooling.
Shares in Nvidia slipped slightly after the announcement. Hugging Face, founded in 2016 by French entrepreneurs Clément Delangue, Julien Chaumond and Thomas Wolf, is backed by Intel, AMD, Amazon, Google, Salesforce, IBM and Qualcomm. Nvidia was already an investor in the startup, having joined at least one funding round in 2023.
Under the terms, Nvidia will pay about $11.9 billion to Hugging Face investors, with an additional equity-based retention package of up to $1 billion for employees who stay with the company. Nvidia CEO Jensen Huang said Hugging Face will "remain an open platform for the entire AI ecosystem" and that users won't be forced to use Nvidia hardware. Huang, who recently signed an open letter supporting open models and opposing restrictive regulation, also noted Nvidia already contributes more than 500 models and 250 open datasets to the platform.
Hugging Face has grown rapidly since the generative AI boom began in 2022, now claiming more than 18 million users, three million shared models, and over 200,000 companies using its tools. Acquiring the platform gives Nvidia direct visibility into which models, datasets and architectures developers are trending toward, weeks before they hit mainstream tech news, according to Naveen Chhabra, principal analyst at Forrester.
The deal comes amid surging demand for open-weight AI models from businesses looking to cut costs, and as Chinese firms like DeepSeek, Moonshot and Z.ai produce models that rival US output at lower prices. Hugging Face CEO Clément Delangue recently said China is winning the AI race because of its embrace of open models. The Trump administration has weighed restricting Chinese open models while trying not to stifle American companies that use them.
For Nvidia, the purchase may help cushion a slowdown from major customers like Meta, OpenAI and Microsoft, which are developing their own chips. The chip market has been volatile this year, with a July selloff wiping $1 trillion from leading firms' market caps, followed by an August rebound that added $442 billion to Nvidia's value in a single day. Hugging Face was also recently in the news after a hack by rogue AI agents that escaped OpenAI's testing environment. The platform offers not just model hosting but also datasets, software libraries and cloud services for building AI applications.
Source: Engadget