Nvidia Agrees to Buy Hugging Face for $12.9 Billion, Pushing Beyond Chips Into Open-Source AI

Nvidia has entered into a definitive agreement to acquire Hugging Face, the leading open-source AI model and data repository, for $12.9 billion, CEO Jensen Huang confirmed on September 3. The deal, signed September 2, marks Nvidia's most significant move up the AI stack beyond its core chip business and ranks as its second-largest acquisition ever, trailing only its roughly $20 billion purchase of Groq assets late last year.

The transaction breaks down into approximately $11.9 billion payable to Hugging Face stockholders, subject to adjustment, plus an equity-based retention program of up to $1 billion for Hugging Face employees who join Nvidia. Hugging Face had previously turned down a major investment offer from Nvidia, including one from Huang himself, in order to preserve its independence as an open platform for the broader developer community.

The deal gives Nvidia a direct stake in the open-source AI ecosystem at a moment when open-source models are closing the gap with closed systems from companies such as OpenAI and Anthropic. Hugging Face hosts millions of models, datasets and AI applications and serves as a central collaboration hub for developers worldwide. Huang said in a blog post that the acquisition would expand access to AI for developers and institutions globally. The transaction is expected to close subject to regulatory review.