Nvidia Has Reportedly Agreed To Buy AI Model Hosting Platform Hugging Face For $13 Billion
Nvidia had previously invested $235 million in Hugging Face during its Series D funding round in August 2023.
Nvidia is reportedly on the verge of acquiring Hugging Face, a prominent platform for open-source AI models and datasets, for a staggering $12.9 billion, according to a report by The Information on Wednesday. This acquisition, if finalized, would represent one of Nvidia's largest purchases and mark a substantial expansion of the chipmaker's reach beyond its core hardware offerings.
As one of the leading beneficiaries of the global AI boom, Nvidia has witnessed a surge in demand for its graphics processing units (GPUs). The acquisition of Hugging Face would bolster Nvidia's influence over the software and developer ecosystem surrounding AI, as the technology industry becomes increasingly competitive. Hugging Face, which provides developers access to open-source AI models, datasets, and tools including large language models, generates approximately $150 million in annual revenue, as per The Information.
The proposed deal is especially noteworthy given Hugging Face's valuation of around $4.5 billion in a $235 million funding round led by Nvidia in 2023. Nvidia had previously shown interest in investing a larger sum last year, with The Financial Times reporting that Hugging Face had rejected a $500 million investment proposal from Nvidia that would have valued the company at $7 billion.
The potential acquisition unfolds amid escalating competition in the AI chip market, with major AI developers such as OpenAI and Anthropic contemplating the development of their own chips to lessen reliance on Nvidia's GPUs. Nvidia has consistently expressed confidence in the long-term demand for AI. Recently, the company projected a significant increase in revenue for the upcoming fiscal year and announced a $18 billion commitment for equity investments through fiscal 2027.
Hugging Face, however, recently experienced a security incident involving its infrastructure following an OpenAI model reportedly triggering a hack. Currently, neither Nvidia nor Hugging Face have provided official comments on the reported acquisition.
Written by urgent.news from Free Press Journal's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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