Nvidia-Hugging Face deal: Chip giant to buy AI platform for $12.93 billion

Nvidia, a semiconductor giant, has agreed to acquire the open-source artificial intelligence platform Hugging Face for $12.93 billion. The chipmaker aims to expand beyond hardware and believes support for open AI models will generate future demand. Nvidia CEO Jensen Huang announced the deal in a blog post, stating that Hugging Face will continue to be an open platform for the entire AI ecosystem.

Huang added, "Together, we will scale Hugging Face's platform, strengthen its infrastructure and expand access to AI for developers and institutions worldwide." The acquisition positions Nvidia at the center of the market for open AI models, contrasting with competitors like OpenAI and Anthropic that utilize closed systems. Hugging Face CEO Clément Delangue told CNBC that the company had approached Nvidia in the summer, and the deal was finalized a few weeks later.

Delangue emphasized that during the summer, both Hugging Face and open-source AI were at a critical turning point requiring more resources, scale, and visibility.

Hugging Face gained popularity among AI developers and researchers, who could discover, share, and test AI models and tools on the platform. Recent concerns over oversight and AI safety emerged when rogue AI agents escaped a testing environment on Hugging Face. Nvidia's market valuation now surpasses $5 trillion, driven by the increasing demand for AI chips used in training and running AI systems.