Nvidia confirms $12.9B acquisition of AI hosting platform Hugging Face

Nvidia announced today that it has reached an agreement to acquire AI platform Hugging Face for a sum exceeding $12.93 billion. Reports indicate that acquisition negotiations had been ongoing for several weeks prior to the announcement. Rumors of a potential deal surfaced as early as last Monday when Business Insider was tipped off about the talks.

Two days later, The Information confirmed that Nvidia had successfully completed the acquisition. In the $12.9 billion deal, a significant portion of the funds will be directed towards competitors such as AMD, Intel, and Qualcomm, which had previously supported Hugging Face during their most recent funding round. Salesforce Inc. also expressed interest in acquiring the company before Nvidia made its move.

Hugging Face operates a platform similar to GitHub, where researchers collaborate and share open-source AI models. The platform also hosts technical elements like training datasets. Nvidia's CEO, Jensen Huang, revealed in a blog post that the platform currently hosts over 500,000 datasets and four times as many models. Hugging Face has expanded into other areas, such as introducing a rollerblade-equipped robotic duck capable of picking up objects with its beak, which generated $5 million in sales within just five days.

The company has also partnered with more than 1,000 researchers to develop its own large language model. Hugging Face's primary revenue stream comes from cloud services aimed at AI development teams. One of their offerings, the Hugging Face Hub, enables the creation of private versions of the AI project hosting platform, while other services allow developers to utilize managed cloud infrastructure for hosting their inference models.

While the $19.3 billion acquisition may not be solely driven by Hugging Face's financial performance, Nvidia CEO Huang emphasized that the company will gain valuable insights into customer preferences and the AI models they utilize. This will allow Nvidia to identify trending models, the datasets being downloaded by customers, and the architectures gaining traction weeks before such information appears in mainstream tech news.