Nvidia Reportedly Agrees to Buy Hugging Face for US$12.9 Billion

Nvidia has reportedly agreed to acquire Hugging Face, an open-source AI platform, for US$12.9 billion, in a deal that would expand Nvidia’s reach from AI computing into open-source models, datasets, and developer tools.

Nvidia is reportedly moving deeper into the software layer of artificial intelligence with an agreement to acquire Hugging Face for US$12.9 billion, according to The Information, in what would rank among the chipmaker’s largest acquisitions. The reported deal would give Nvidia control of one of the most widely used platforms for developing, sharing and testing open-source AI models. It would also extend the company’s position across the AI technology stack as competition increasingly expands beyond chips and computing infrastructure.

The reported acquisition follows interest from another potential buyer that emerged after Hugging Face began receiving acquisition approaches, according to The Information.

Business Insider separately reported that Nvidia had been in talks to acquire the company and that Hugging Face had been working with a bank to evaluate interest from potential bidders.

A source familiar with the matter told CNBC that an acquisition by Nvidia had been part of ongoing and recent talks. The source spoke anonymously because the details were not public.

Hugging Face provides developers with access to open-source models, datasets, and tools used to build and test AI applications. Its platform has become part of the development infrastructure supporting open AI models, placing it at a strategic point between model developers and the computing resources required to train and deploy them.

For Nvidia, the transaction would extend a strategy that has increasingly reached beyond graphics processing units and into other parts of the AI ecosystem.

Siddy Jobe, Fund Manager, Eonopolis Exponential Technologies, says Hugging Face would fit Nvidia’s platform strategy because the company has signaled that it is not limiting its AI investments to either closed or open-source models. “I think Nvidia is very much a community, a platform-based company, and in that respect, I think Hugging Face fits perfectly within that,” Jobe told CNBC.

Jobe says Nvidia’s strategy increasingly covers multiple layers of AI infrastructure, including foundational models and applications. “It is clear that Nvidia wants to be integrated in the entire stack vertically, going from energy to foundational models and also to applications,” he adds.

The transaction would also come as developers of closed-source models, including OpenAI and Anthropic, pursue efforts to develop their own AI chips and reduce reliance on Nvidia’s GPUs.

A Sharp Increase in Hugging Face’s Valuation

The US$12.9 billion price would represent a substantial increase from Hugging Face’s previous valuation. Nvidia was among the investors that participated in the company’s US$235 million funding round in 2023, which valued Hugging Face at US$4.5 billion.

The Financial Times reported in January that Hugging Face had rejected a US$500 million investment offer from Nvidia in 2025 that would have valued the company at US$7 billion. The reported acquisition price also contrasts with Hugging Face’s annualized revenue of about US$150 million, according to The Information.

The deal would therefore represent a significant financial commitment as Nvidia continues to invest across the AI ecosystem. The company has backed AI developers including OpenAI and has pursued other transactions and strategic agreements, including a reported US$20 billion deal involving AI chip startup Groq.

The acquisition would also follow a recent security incident involving Hugging Face that raised concerns about the security of AI development infrastructure. Clément Delangue, CEO, Hugging Face, attributes the incident to engineering mistakes and said the company used an Nvidia version of a Chinese open model to address the attack.

Delangue says the broader market for AI-driven cybersecurity is likely to expand as AI capabilities develop. “AI cybersecurity is going to become a huge market in the United States and in the world,” Delangue told CNBC earlier this month. He added that open models could become dominant in that market.

Nvidia’s AI Demand Continues to Accelerate

The reported acquisition comes as Nvidia continues to post rapid growth tied to AI infrastructure demand. The company reported US$96.2 billion in revenue for the 2Q27, ended July 26, 2026, up 106% from a year earlier and 18% from the previous quarter.

Data Center revenue reached US$89 billion, increasing 117% year over year. Nvidia reported GAAP net income of US$59.7 billion, up 126%, while diluted earnings per share rose 128% to US$2.46.

Nvidia expects third-quarter fiscal 2027 revenue of US$108 billion, plus or minus 2%. The company’s outlook does not assume any Data Center compute revenue from China.

Jensen Huang, CEO, Nvidia, says demand for AI computing continues to accelerate as more companies and AI laboratories deploy the technology. “AI has reached its inflection point. It’s doing useful work. Its tokens are productive and profitable. Now, compute is revenue,” Huang says.

The company also said it has US$18 billion committed to equity investments through fiscal 2027. Against that backdrop, a potential US$12.9 billion acquisition of Hugging Face would add another major component to Nvidia’s expanding position in the AI market.