Nvidia’s Hugging Face Acquisition Is a $12.9 Billion Bet on Open-Source AI
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Summary
Nvidia has agreed to acquire Hugging Face, which makes online developer tools and maintains a massive library of open-source data sets, for nearly 13billion.Whilethedealhadbeenrumoredforweeks,thecompaniesmadeitofficialThursdaymorning.ThedealsignalsNvidia’sseriousnessaboutbeingsteepedinthesoftwaresideofgenerativeAIdevelopmentaswellasininfrastructure.[Nvidia](https://www.wired.com/tag/nvidia)alreadyofferscustomersasuiteoffree,customizableopen−weightsAImodels,knownasNemotron.Aspartofitsannouncement,NvidiacommittedtomaintainingHuggingFace’scurrentopenstandards,suggestingthatthechipmakerispositioningitselfasanevengreaterresourcefordeveloperslookingtoaccesscutting−edge,nonproprietarytools.ThemovealsounderscoresNvidia’spositionthatopen−weightsmodelsarebetterforthetechindustrythanclosed,proprietaryAImodelslikethosedevelopedby[OpenAI](https://www.wired.com/tag/openai)and[Anthropic](https://www.wired.com/tag/anthropic).Earlierthismonth,Nvidia[ralliedmorethan80companies](https://www.wired.com/story/the−white−house−is−keeping−its−ai−cybersecurity−framework−secret/)tosignanopenletteraskingtheUSgovernmenttodefendopen−weightAImodels.NvidiaalsolaunchedaninitiativecalledSAFE,orSharedAIFindingsExchange,thatencouragedtechcompaniesto“confidentiallycollectandanalyzeAIincidentsandnearmisses,identifyrecurringcontrolfailuresandpublishevidence−basedoperatingrecommendationsthatreducesystemicrisk.”“Openmodelsletstartups,businesses,universitiesandpublicinstitutionsbuildonadvancedcapabilitieswithouttrainingeverymodelfromscratch,”[NvidiaCEOJensenHuang](https://www.wired.com/story/nvidia−ceo−jensen−huang−took−a−call−from−donald−trump−in−the−middle−of−an−all−hands/)saidinthepressreleaseannouncingthedeal.“AIadvancesfasterwhenpeoplecanbuildtogether.”Nvidia’sembraceofopen−sourcesoftwareandopen−weightsAImightseemlikeanabruptturn,especiallygiventhatCUDA,thesoftwarelayerforitshighlycovetedGPUs,isitselfproprietary.ButasfrontierAIlabsandsomeofthelargehyperscalers,includingAmazonandMeta,seektobuildtheirowncustomchips,NvidiahasbeguntopositionitselfasamakerofnotjustGPUsbutalsohigh−performanceCPUs,andhaswideneditssoftwareofferingsinordertokeepdevelopersbuildingonNvidia’splatforms.BusinessInsiderpreviously[reported](https://www.businessinsider.com/nvidia−in−talks−to−buy−hugging−face−13−billion−dollars−2026−8)thatthetwocompanieswereintalks,andTheInformationlater[reported](https://www.theinformation.com/articles/nvidia−agrees−buy−open−source−model−repository−hugging−face−12−9−billion)thatadealhadbeenreached.HuggingFacewasfoundedadecadeagobythreeFrenchentrepreneursinNewYorkCity,whowantedtolaunchanAI“companion”app.Thatdidn’tcatchon,buttheteam’seffortstobuildtheirownnaturallanguageprocessing(NLP)toolsinspiredtheirnextmove:makingcomplextechtoolsmoreaccessibletodevelopers.HuggingFaceeventuallybecameaplatformfordeveloperstofreelysharesourcecode,datasets,and,inthegenerativeAIera,largelanguagemodels.“Open−sourceAIisataninflectionpoint,”wroteHuggingFacecofounderandCEOCleˊmentDelangueina[post](https://x.com/ClementDelangue/status/2095482998674112733)onXannouncingtheacquisition.“Thankstothecommunity,we’veshownthatitcanbeacomplement,andevenanalternative,toclosed−sourceAPIs.Butforittohappenatlargerscale,itneedsmorecompute,moresupport,morecollaborationandmorevisibility.”AccordingtoPitchBookdata,HuggingFacehadraisednearly400 million in venture capital funding as of December 2025. Some of its backers include Betaworks, Lux Capital, Sequoia Ventures, Coatue, and Addition. Notable individual investors include Greg Brockman, Richard Socher, and the NBA player Kevin Durant.
Hugging Face has more recently been front and center after its platform was hacked by AI agents from OpenAI. The incident sparked a broader conversation across the tech industry about the safety, security, and manageability of the autonomous agents being touted by top AI companies.
In a 2023 interview with CNBC Delangue predicted that the number of developers working with AI models would soar, and estimated that within five years, “you’re going to have like 100 million AI builders. And if all of them use Hugging Face all day, every day, we’ll obviously be in a good position.”
Obviously, Nvidia seems to agree.
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