Nvidia Reportedly Close to Acquiring Hugging Face in $12.9 Billion Deal

Nvidia is reportedly on the verge of finalizing the acquisition of Hugging Face, one of the world’s leading platforms for artificial intelligence (AI) models and tools. The deal could be completed as early as this week, with a valuation of approximately $12.9 billion. Additionally, the agreement may include a retention program worth up to $1 billion for the startup’s employees. However, no definitive agreement has been signed yet.

A Leader in Open-Source AI

Founded in 2016, Hugging Face has quickly established itself as a cornerstone of the open-source AI ecosystem. Its platform hosts a vast array of models, datasets, and tools that enable developers to design, train, and deploy AI applications. The startup boasts a significant global community of developers and users, solidifying its position as a key player in the AI landscape.

Strategic Expansion for Nvidia

For Nvidia, this acquisition represents a strategic move to extend its influence beyond its traditional role as a chip manufacturer. The company is actively working to strengthen its entire AI ecosystem, spanning from computing infrastructure to software and AI models. Integrating Hugging Face would provide Nvidia with privileged access to a massive developer community and the open-source technologies that are central to modern AI development.

Previous Investment History

Nvidia has a prior relationship with Hugging Face. The chipmaker participated in the startup’s $235 million funding round in 2023, which valued the company at $4.5 billion. In 2025, Nvidia reportedly offered to invest an additional $500 million at a valuation of $7 billion, an offer that was rejected by Hugging Face.

Consolidating Power in the AI Value Chain

This proposed acquisition comes at a time when Nvidia is making multiple investments to consolidate its dominant position in the AI sector. Facing rising competition from major players like OpenAI and Anthropic, the chipmaker is seeking to control more components of the AI value chain.

Including the employee retention package, the total value of the transaction could reach nearly $14 billion. However, the deal remains contingent on the signing of a definitive agreement and is subject to change or potential failure.