Nvidia agrees to buy Hugging Face

Overview

Updated 7 days ago

Nvidia confirmed on Sept. 3 that it agreed to buy Hugging Face for $12.93 billion. The signed deal includes an $11.9 billion payment to shareholders plus up to $1 billion in stock for employees.

Hugging Face hosts three million open-source models and is used by more than 18 million developers. Nvidia promised to keep the platform open to all model makers and hardware vendors, but the deal still faces antitrust review and is expected to close in the first half of 2027.

Why it matters

Nvidia dominates AI chips. Owning Hugging Face tightens its hold on the open-source models that keep rivals buying those chips.

Questions about this story

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Why would Nvudua want to own Hugging Face? Do they make money, or have a solid plan to make money?

Nvidia wants Hugging Face to control the distribution channel for open-source AI and protect its chip dominance as big labs build their own silicon — not for Hugging Face's revenue, which is real (~$150 million, near-profitable) but tiny next to a $12.9 billion price.

Why it matters: The deal would hand the dominant chipmaker the gatekeeper role over the platform where most of the industry shares and runs open AI models.

Hugging Face does make money: about $150 million in annualized revenue, up from roughly $100 million two months earlier, with 2,000+ paying enterprise customers and the CEO saying it is 'close to profitability' [techcrunch.com](https://techcrunch.com/2026/08/26/nvidia-closes-in-on-hugging-face-acquisition/), [tradingkey.com](https://www.tradingkey.com/analysis/stocks/us-stocks/262135106-nvidia-129-billion-hugging-face-what-is).
But $12.9 billion is roughly 86 times that revenue — one analyst calls it 'a strategic premium on distribution,' not a software valuation [infoworld.com](https://www.infoworld.com/article/4214823/nvidia-eyes-12-9-bn-hugging-face-deal-to-expand-ai-platform-control.html), [techspot.com](https://www.techspot.com/news/113640-nvidia-closes-129-billion-hugging-face-acquisition-neutrality.html).
The strategic logic is chip protection: OpenAI, Google, Amazon, and Anthropic are all building their own AI chips, so Nvidia wants a thriving open-source ecosystem that keeps more of the market dependent on its hardware [techcrunch.com](https://techcrunch.com/2026/08/26/nvidia-closes-in-on-hugging-face-acquisition/).
Owning the hub also gives Nvidia sway over which hardware developers run their models on, a cheap way back into cloud computing after scaling back DGX Cloud, and an outlet to sell unused cloud capacity Nvidia is already on the hook for [businessinsider.com](https://www.businessinsider.com/hugging-face-nvidia-deal-reshape-ai-landscape-2026-8), [techcrunch.com](https://techcrunch.com/2026/08/26/nvidia-closes-in-on-hugging-face-acquisition/).

Sources

Room for disagreement

Neutrality is the core risk: Hugging Face's value rests on sitting above the hardware fight, and analysts warn that Nvidia owning it could push developers toward AMD, AWS, and Google — though most expect Nvidia to preserve openness initially to avoid destroying the asset [businessinsider.com](https://www.businessinsider.com/hugging-face-nvidia-deal-reshape-ai-landscape-2026-8), [infoworld.com](https://www.infoworld.com/article/4214823/nvidia-eyes-12-9-bn-hugging-face-deal-to-expand-ai-platform-control.html).
Coverage also differs on the deal's status: The Information reports an agreement, while Business Insider says talks could still fall apart [businessinsider.com](https://www.businessinsider.com/nvidia-in-talks-to-buy-hugging-face-13-billion-dollars-2026-8).

AI-generated with web search — may be wrong. Check the linked sources.

Key Indicators

$12.93B

Confirmed deal value

Nvidia announced the $12.93 billion deal on Sept. 3. It includes $11.9 billion for shareholders and up to $1 billion in employee retention equity.

$150M

Hugging Face annualized revenue

Per The Information; the price is roughly 86 times that revenue.

86x

Implied price-to-revenue multiple

Deal value divided by Hugging Face's reported annualized revenue.

$4.5B

Hugging Face's 2023 valuation

Set in a $235 million round led by Salesforce Ventures with Nvidia participating.

H1 2027

Expected closing

Nvidia said the deal should close in the first half of 2027, pending regulatory approvals.

Voices

Curated perspectives — historical figures and your fellow readers.

Ever wondered what historical figures would say about today's headlines?

People Involved

Jensen Huang

Chief executive of Nvidia

Announced Nvidia's $12.93 billion acquisition of Hugging Face

Clem Delangue

Co-founder and chief executive of Hugging Face

Has not publicly commented; Huang said Delangue approached Nvidia about the sale

Thomas Wolf

Co-founder of Hugging Face

Discussed the reported sale with The Next Web; no formal public statement

Organizations Involved

Nvidia Corporation

Semiconductor and AI computing company

Buyer in confirmed $12.93 billion deal

The dominant maker of AI processors, whose graphics processing units train and run most large language models.

Hugging Face

AI platform

Acquisition target; agreed to be acquired by Nvidia

The main hub where developers share, download, and fine-tune open-source AI models and datasets.

Microsoft

Technology company

Fellow suitor; talks with Hugging Face not ongoing

Met with Hugging Face about a possible acquisition, but two people familiar with the matter said those talks are not ongoing.

Timeline

2016 September 2026

8 events Latest: September 2nd, 2026 · 1 week ago

Tap a bar to jump to that date

September 2026
Nvidia signs definitive agreement to buy Hugging Face
Latest Deal

An 8-K filing said Nvidia agreed to pay $11.9 billion to Hugging Face shareholders plus up to $1 billion in employee retention equity, for a total of about $12.93 billion.
September 2nd, 2026
August 2026
Pomegra flags antitrust as main closing risk
Analysis

Pomegra Startups noted the deal requires a US Hart-Scott-Rodino filing and will get full review, with Nvidia already facing DOJ and European inquiries over its AI-chip dominance.
August 30th, 2026
Hugging Face co-founder discusses sale with The Next Web
Interview

Thomas Wolf, who co-founded Hugging Face, spoke to The Next Web about the reported acquisition. The outlet noted the deal has not closed and remains subject to regulatory approval.
August 29th, 2026
Reuters confirms; analysts warn on neutrality
Analysis

Reuters confirms the agreement; analysts warn the deal threatens Hugging Face's neutrality.
August 27th, 2026
Nvidia agrees to buy Hugging Face
Deal

The Information reports Nvidia agreed to buy Hugging Face for $12.9 billion.
August 26th, 2026
Business Insider reports Nvidia in talks
Report

Business Insider reports Nvidia in talks to buy Hugging Face for over $13 billion.
August 23rd, 2026
August 2023
Hugging Face raises $235 million
Funding

Round led by Salesforce Ventures values the company at $4.5 billion; Nvidia invests.
August 2023
2016
Hugging Face founded
Founding

Hugging Face founded as a chatbot app.
2016

Scenarios

Nvidia closes Hugging Face acquisition after antitrust review

Likely Resolves by Q2 2027

Discussed by: Reuters, The Information

The deal passes regulatory review and closes, giving Nvidia control of Hugging Face's models, datasets, and developer community. Nvidia has incentives to keep the platform open, since developer trust depends on it, but could steer usage toward its own hardware and cloud services. Sanchit Vir Gogia of Greyhound Research said the near-term effect would be "greater operational coupling rather than immediate exclusion."

Nvidia-Hugging Face deal collapses as talks fall through

Possible Resolves by End of 2026

Discussed by: Business Insider

Negotiations break down over price, terms, or regulatory risk, and one or both parties walk away. Business Insider reported the talks could still collapse and that no signed agreement exists yet. Microsoft, which met with Hugging Face about a deal, could re-emerge as a rival bidder if Nvidia exits.

Regulators block or put conditions on Nvidia-Hugging Face deal

Possible Resolves by Q2 2027

Discussed by: The Next Web, TechSpot

Competition authorities in the US, EU, or UK open a formal review, citing Nvidia's dominance in AI accelerators. The Next Web noted Nvidia already faces scrutiny over its chip position and that buying the default hosting layer of the open-source ecosystem "is the sort of vertical move enforcers watch for." Regulators could block the deal or clear it with conditions that protect the platform's neutrality.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

October 2018 - July 2019

IBM buys Red Hat (2018-2019)

IBM agreed to pay $34 billion for Red Hat, the leading distributor of the open-source Linux operating system. Red Hat had built enterprise trust as an independent provider of open-source software.

Then

The deal closed after a long review. Red Hat kept its open-source licenses and its brand.

Now

IBM anchored its hybrid-cloud strategy around Red Hat, showing an open-source company could thrive under a large owner.

Why this matters now

A precedent for a big vendor buying an open-source company. Red Hat kept operating independently, but its new owner set the direction, the pattern analysts expect if Nvidia gets Hugging Face.

September 2020 - February 2022

Nvidia's failed ARM acquisition (2020-2022)

Nvidia agreed to buy chip designer ARM Holdings for $40 billion. Regulators in the UK, US, and EU objected, worried Nvidia would control the chip architecture used by nearly every rival's products.

Then

Nvidia abandoned the deal in February 2022 and paid ARM's owner SoftBank a $1.25 billion breakup fee.

Now

ARM pursued an independent public listing. Nvidia stayed a customer rather than an owner.

Why this matters now

It shows Nvidia's acquisitions face serious antitrust scrutiny when they would control infrastructure that rivals depend on. Hugging Face hosts models for Nvidia's competitors, a similar position.

January 2022 - October 2023

Microsoft's Activision Blizzard deal (2022-2023)

Microsoft agreed to pay $68.7 billion for game publisher Activision Blizzard. Britain's competition regulator initially blocked the deal, and the US Federal Trade Commission sued to stop it.

Then

Microsoft closed the deal in October 2023 after offering concessions, including licensing game rights to rivals.

Now

The deal became the template for large tech acquisitions clearing regulators with conditions that protect competitors.

Why this matters now

A recent example of a huge tech deal that passed regulators only after binding concessions. A similar process could shape the Nvidia-Hugging Face deal, especially around keeping the platform neutral.