$12.93 Billion: NVIDIA Acquires Hugging Face!

According to NVIDIA, the company has reached a definitive agreement to acquire Hugging Face, the world’s largest open-source AI model platform, for approximately $12.93 billion. NVIDIA CEO Jensen Huang announced the deal through the company’s official blog on September 3, 2026, marking the company’s second-largest acquisition to date, behind its $20 billion acquisition of chipmaker Groq in late 2025.

According to an 8-K filing submitted by NVIDIA to the U.S. Securities and Exchange Commission (SEC), the two companies signed the definitive agreement on September 2. The transaction consists of approximately $11.9 billion in cash to Hugging Face shareholders and up to $1 billion in equity retention awards designed to retain Hugging Face employees who join NVIDIA.

Hugging Face’s valuation has increased sharply in recent years. The company was valued at $4.5 billion after raising $235 million in 2023. Last year, Hugging Face reportedly rejected a $500 million investment offer from NVIDIA that valued the company at $7 billion. The latest acquisition price therefore represents nearly a doubling of its valuation compared with the negotiations at the end of last year.

NVIDIA expects the transaction to close in the first half of 2027, subject to customary closing conditions, including the receipt of required regulatory approvals.

Huang also emphasized that Hugging Face will remain an open platform serving the broader AI ecosystem. The commitment is included in the SEC filing and is legally binding. Developers will not be required to use NVIDIA computing infrastructure to develop or deploy models through Hugging Face. The platform will continue supporting multi-cloud and multi-accelerator environments, while allowing model creators, developers, and users to upload and download the models and datasets of their choice.

Huang thanked the millions of developers using Hugging Face, saying NVIDIA looks forward to working with the community to build a more open and powerful AI ecosystem and expand access to AI for individuals and organizations worldwide.

The acquisition highlights NVIDIA’s broader strategy of expanding beyond AI accelerators and building a stronger position across the AI software and model ecosystem. As the AI hardware market becomes increasingly competitive and concerns continue to emerge over the sustainability of AI infrastructure spending, controlling an important distribution and development platform for AI models could provide NVIDIA with strategic value beyond selling GPUs and other computing hardware.

Hugging Face currently serves a massive AI development community, with approximately 18 million developers, 3 million models, 500,000 datasets, and 200,000 enterprise users. Hugging Face CEO Clément Delangue told CNBC that he contacted Huang during the summer to advance discussions about the transaction. He described open-source AI as being at a turning point and said the ecosystem requires greater resources, scale, and visibility, making NVIDIA a strong fit for the company’s next stage of development.

The acquisition also continues NVIDIA’s expansion into AI software and infrastructure. The company has previously acquired AI software companies including Run, SchedMD, and Kumo AI. At the same time, reports have indicated that NVIDIA is in discussions to invest in AI search company Perplexity, which could value the company at more than $30 billion if a deal is completed.

Since last year, NVIDIA has also made major strategic investments across the semiconductor and computing ecosystem, including $5 billion in Intel, $2 billion in Synopsys, $2 billion in Coherent, up to $3.2 billion in Corning, and $3.5 billion in MediaTek. NVIDIA has additionally participated in financing rounds for leading AI companies such as OpenAI, Anthropic, Poolside, and SpaceX, further demonstrating its strategy of building a broad AI ecosystem alongside its core GPU business.