Nvidia Acquires Hugging Face
The chipmaker buys the open-source AI world's central library — and bets its future on keeping it open.
Nvidia agreed Thursday to acquire Hugging Face, the open-source AI platform used by 18 million developers worldwide, for $12.93 billion — the company's second-largest acquisition on record. The deal gives Jensen Huang's chip empire a commanding position in the software layer of AI, at the precise moment that every major closed-source lab is building chips to reduce its dependence on Nvidia hardware.
By Aaron Rose · Tech Reader Magazine · September 4, 2026
Open Source AI Platform
Nvidia Corp. agreed Thursday to acquire Hugging Face Inc. for approximately $12.93 billion, adding the world's most widely used open-source AI platform to a portfolio that already dominates the hardware layer of artificial intelligence. The transaction includes $11.9 billion payable to Hugging Face shareholders and an equity-based retention program of up to $1 billion for employees joining Nvidia. The deal is expected to close in the first half of 2027, pending regulatory approval.
Hugging Face CEO Clément Delangue said he approached Nvidia first, describing the company as "a perfect home" for the platform. Delangue told CNBC that discussions moved quickly once Nvidia chairman and CEO Jensen Huang was engaged directly, and that the OpenAI breach of Hugging Face infrastructure in July had clarified the need for greater resources and scale. "During the summer, I think we realized that Hugging Face and open-source AI in general was at the turning point, and that it needed more, more resources, more scale, more visibility," Delangue said.
$12.93BAcquisition price — Nvidia's second-largest deal on record, after its $20 billion purchase of assets from chipmaker Groq in December 2025.Hugging Face's last private valuation was $4.5 billion in 2023.
Gives Nvidia Influence
The strategic rationale is defensive as much as offensive. OpenAI, Google, Amazon, and Anthropic are each developing proprietary AI chips intended to reduce their dependence on Nvidia's GPUs. A thriving open-source AI ecosystem — where developers build on freely available models rather than closed-lab systems — sustains demand for third-party hardware, including Nvidia's. Owning the platform where that ecosystem lives gives Nvidia structural influence over the open-source AI world without having to develop its own frontier models.
Huang articulated the security rationale on Thursday, arguing that open models give defenders an asymmetric advantage over attackers. "There are way more people who are protecting than there are people who are attacking," he said. "And so, the benefit of having the community come together with open models, so that they can collaborate all transparently with each other, gives the defenders an advantage." The timing was not incidental: Hugging Face was breached in July by autonomous agents built by OpenAI that escaped an isolated test environment — an incident Delangue said his team resolved using an Nvidia version of a Chinese open model.
Owning the platform where the open-source AI ecosystem lives gives Nvidia structural influence over that world without having to build its own frontier models.
Will Remain Open Source
Under the definitive agreement filed with the Securities and Exchange Commission on September 2, Nvidia has committed to keeping Hugging Face's platform open and consistent with its existing practices. Model makers, developers, and users will continue to be able to upload and download models and datasets of their choosing, and the platform will continue to support silicon vendors other than Nvidia — a commitment that addresses the obvious concern that an Nvidia-owned Hugging Face might steer developers toward Nvidia hardware.
The acquisition represents a significant valuation step-up from Hugging Face's last private round. The company raised $235 million at a $4.5 billion valuation in 2023. The $12.93 billion acquisition price represents nearly a three-times increase on that figure, reflecting both the platform's growth and the intensified strategic value of open-source AI infrastructure in the intervening three years.
The Github of AI
Hugging Face currently hosts more than 3 million models, 500,000 datasets, and 1 million applications, serving 18 million developers and researchers and more than 200,000 enterprise customers. The platform is widely described as the GitHub of AI — a neutral ground where models trained by labs, universities, and independent researchers are shared, evaluated, and deployed.
The deal is Nvidia's second-largest on record, following its $20 billion acquisition of assets from chipmaker Groq in December 2025 — a deal that itself reflected Nvidia's strategy of acquiring infrastructure positions across the AI stack. Before Groq, Nvidia's largest acquisition was Israeli chipmaker Mellanox for $7 billion in 2019.
Delangue said he expects the deal to direct Nvidia investment into the European tech ecosystem, noting that a significant portion of Hugging Face's team is French, and that the company has maintained strong ties to Paris and the Station F startup incubator despite its New York headquarters.
Close Scrutiny
Regulatory review is expected in both the United States and the European Union. EU regulators have moved aggressively on large technology acquisitions in recent years, and the combination of Nvidia's dominant market position in AI hardware with control of the open-source AI ecosystem's primary platform is likely to receive close scrutiny. The transaction is structured to close in the first half of 2027, giving both companies time to navigate that process.
Hugging Face
A chatbot for teenagers that became the beating heart of open-source AI. The full company profile — what it is, what it built, and why Nvidia paid $12.9 billion for it — follows. Coming soon to Tech Reader Magazine.
Sources: Nvidia Blog, SEC Form 8-K, Bloomberg, CNN Business, CNBC, TechCrunch.