Nvidia has agreed to buy open-source AI platform Hugging Face for $12.9 billion, according to a report in The Information, which cited a person with knowledge of the deal. CNBC reported that neither Nvidia nor Hugging Face immediately responded to requests for comment. The acquisition would place one of the most widely used platforms for sharing and working with open-source AI models under Nvidia's ownership, expanding the chipmaker's reach further into the software and model ecosystem.
The deal would mark a significant step in Nvidia's strategy to entrench itself across the entire AI stack, from hardware to foundational models. It also arrives at a moment when the open-source AI community is increasingly closing the gap with closed systems from companies like OpenAI and Anthropic.
How the deal unfolded
Business Insider first reported that Hugging Face was fielding takeover interest, having worked with a bank to evaluate potential bidders. The Information said the talks accelerated after Hugging Face received interest from another suitor. TechCrunch reported that neither company had confirmed the report at the time of publication.
As of late August 2026, no signed agreement has been reached, and the deal could still fall apart, Business Insider reported. Neither Nvidia nor Hugging Face responded to requests for comment at the time of reporting.
The price represents a substantial jump from Hugging Face's last known valuation. The company raised $235 million in a Series D funding round in August 2023 that valued it at $4.5 billion. That round was led by Salesforce Ventures, with participation from Nvidia, Alphabet's GV, Amazon, AMD, Intel, Qualcomm, and IBM.
Hugging Face had previously rejected a $500 million investment offer from Nvidia in late 2025 that would have valued the company at $7 billion, the Financial Times reported. At the time, Hugging Face said it did not want a dominant investor that could sway its decisions.
Why Nvidia wants Hugging Face
Most obviously, the acquisition would help Nvidia protect its dominance in AI chips. Major tech companies including OpenAI, Google, Amazon, and Anthropic are all building their own AI chips to reduce reliance on Nvidia hardware. A thriving ecosystem of open-source AI models gives customers more alternatives to those closed labs, which in turn keeps more of the market dependent on Nvidia's GPUs.
Hugging Face hosts over 2 million public models and more than 500,000 public datasets, serving a community of roughly 13 million users. Developers who download open-source models from the platform need to host and run those models on their own computing infrastructure, which typically involves Nvidia GPUs, either on premise or hosted in the cloud. Hugging Face also uses Nvidia GPUs to run its paid hosting services for developers.
The deal would also give Nvidia a path back into cloud computing. Nvidia reportedly scaled back its DGX Cloud business about a year ago. Hugging Face already helps developers run AI models using rented computing power, and owning the platform could give Nvidia a way to re-enter that market without starting from scratch.
There is also a financial safety net at play. Nvidia has promised to help cover the cost of tens of billions of dollars in cloud computing deals for its customers. If those customers do not use all the computing power they signed up for, Nvidia could be left with excess capacity. Owning Hugging Face would give Nvidia the ability to sell that unused capacity to Hugging Face's customers.
Hugging Face's financial position
The Information reported that Hugging Face was recently generating about $150 million in annualized revenue, up from roughly $100 million just two months earlier. CEO Clem Delangue told TechCrunch in July that the company was nearing profitability.
At roughly $150 million in annual revenue, the $12.9 billion price tag represents a multiple of about 86 times annual revenue, a figure that is difficult to justify for a company of this size. Still, a buyout at this level would be hard to resist for a company that has raised just $235 million to date.
The broader context
The talks come as AI infrastructure companies increasingly get absorbed by larger players. Stripe recently acquired OpenRouter, a startup that helps customers select different AI models, for more than $7 billion, according to TechCrunch.
Hugging Face's leadership has publicly aligned with Nvidia's open-source push. Delangue signed a letter this year alongside Nvidia CEO Jensen Huang and more than 24 other companies, urging the U.S. government to support open models rather than restrict them. The push for openness has been fueled by concerns about Chinese labs like Moonshot AI, which released its Kimi K3 model, a system that rivals leading U.S. models on benchmarks while costing significantly less to run.
Hugging Face has also been in the spotlight over the last several months after OpenAI disclosed that its own AI models were behind an autonomous cyberattack on the platform. The incident, which OpenAI bots attacked Hugging Face in July 2026, drew alarm from researchers and politicians about the risks of increasingly capable autonomous AI agents.
What comes next
If the deal closes, it would be one of the largest acquisitions in AI history and would raise significant antitrust questions. Nvidia's proposed purchase of Arm collapsed in 2022 under global regulatory pressure, and regulators may view this deal through a similarly skeptical lens.
The acquisition would give Nvidia greater influence over how developers find, share, optimize, and deploy AI models. It would also consolidate the open-source AI ecosystem under a single company with deep ties to the dominant chipmaker in the industry.
Whether regulators approve the deal, and whether Hugging Face can maintain its neutrality under Nvidia ownership, remain open questions. The company's community of developers and researchers will be watching closely.