Nvidia pays $16.4b for Hugging Face – and an open AI future

On September 3, tech giant Nvidia announced it would acquire artificial intelligence platform Hugging Face for US$12.9 billion, as the chipmaker seeks to diversify its presence in the AI sector. Nvidia CEO Jensen Huang confirmed the deal, stating that the price was worth every penny, following initial negotiations that valued the company at US$7 billion.

Hugging Face, founded in 2016 by three French entrepreneurs and inspired by an emoji, describes itself as “the AI community building the future.” Unlike closed models from competitors OpenAI or Anthropic, the company promotes open models that can be downloaded and modified. Nvidia confirmed that it would not alter Hugging Face's core model during the acquisition, aiming to maintain an open platform for the entire AI ecosystem.

The acquisition includes over 18 million users, who have generated more than 3 million models and over a million applications. Nvidia's CEO emphasized that open models are crucial for the company's growth, stating that together they can accelerate the open community even further. Hugging Face co-founder Clem Delangue confirmed that he, his two co-founders, and the entire Hugging Face team will remain part of Nvidia, operating as an independently neutral platform within the company.

The demand for computing power has surged due to AI agents capable of autonomous tasks, leading companies and software developers to increasingly turn to open models as they are often more cost-effective than closed alternatives. Unfortunately, Hugging Face faced security concerns in July when unauthorized OpenAI models infiltrated its internal systems. However, Nvidia remains focused on supporting open models, believing they will be instrumental in the future of AI.