Nvidia Buys Hugging Face for $12.93 Billion

Nvidia confirmed on 3 September that it will acquire Hugging Face, the repository that has become the default place to publish and download open-weight AI models, for $12.93 billion. The deal is expected to close in the first half of 2027, subject to regulatory approval. It is the largest acquisition of a software company in Nvidia’s history, and the second-largest deal it has ever done.

Hugging Face is not large by revenue. Founded in 2016 as a chatbot company, it raised roughly $395 million in total, most recently a $235 million round in 2023 led by Salesforce Ventures with Google, Amazon, IBM and Nvidia itself participating. Reported annualised revenue sits at about $150 million, which puts the purchase price somewhere near 85 times sales. What Nvidia is buying is not the income statement. It is the distribution: more than 18 million developers, over 3 million models, 500,000 datasets, 1 million applications, and more than 200,000 companies that use the platform to find and ship models.

Nvidia’s public framing leans hard on continuity. The company points out that it is already the single largest contributor to the platform, having published over 500 models and 250 datasets there. Chief executive Jensen Huang said the hub would stay neutral: “Developers will choose the models they want, the frameworks they want, the clouds and inference service providers they want.” Elsewhere he argued that “open weights broaden access to AI and help ensure that AI leadership is distributed across companies, institutions and communities.” Nvidia says it will invest in infrastructure, safety tooling, model evaluation and deployment while preserving the platform’s multi-cloud, multi-accelerator character.

Hugging Face chief executive Clem Delangue framed the sale as a scaling problem rather than an exit. The company needed “more compute, more support, more collaboration, and more visibility,” he said. According to CNBC, Delangue approached Huang weeks before the agreement was signed — a notable reversal for a company that had reportedly turned down a $500 million offer from Nvidia in the past. Bloomberg reports the headline price includes an equity retention pool worth as much as $1 billion for Hugging Face staff who join Nvidia.

The deal did not come out of nowhere. BitsMinds reported in August that Hugging Face was exploring a sale at around $13 billion, close to three times its 2023 valuation. It also lands in the middle of an unusually acquisitive stretch for Nvidia, which bought roughly $20 billion of assets from chipmaker Groq in December and paid Poolside $6 billion to license its model factory in August.

The obvious tension is structural. Hugging Face’s value rests on being the one place in the ecosystem that is indifferent to whose accelerator you run on; Nvidia’s value rests on that answer being its own. Huang’s commitment to neutrality is explicit, and the platform’s hosting of models optimised for AMD, Google and Amazon silicon is easy to measure over time. Regulators reviewing the transaction through 2027 will be looking at precisely that question, and the review window is long enough that the answer will be partly observable before the deal closes.