Deal announced
Jensen Huang, chief executive of Nvidia, confirmed on Thursday that the company will purchase Hugging Face for $12.93 billion. The transaction, valued at roughly 86 times Hugging Face's annualised revenue of $150 million, is set to close in the first half of 2027.
Strategic significance
The acquisition gives Nvidia a major foothold in the open-source AI ecosystem at a time when models released by the community are increasingly challenging closed-source offerings from firms such as Anthropic and OpenAI. Hugging Face hosts more than three million models, half a million datasets and a million applications used by over 18 million developers, researchers and creators worldwide.
Deal details
According to Nvidia, more than 200 000 companies already rely on Hugging Face's platform. The company has said it is approaching profitability after a decade of growth. The price reflects Nvidia's view of the platform's strategic value rather than its current earnings.
"Nvidia compute will not be required to build on or deploy through the platform," Huang wrote in a blog post.
Industry reaction
Dan Ives, partner and senior managing director at Yorkville Ives, said the valuation underscores the scarcity of an asset that provides such broad access to AI models. "Nvidia and Jensen see the bigger AI picture," he told the reporter, adding that the price is justified by the strategic advantage.
Financial backdrop
The deal follows Nvidia's $20 billion licensing and talent agreement for AI-chip startup Groq's assets in December. Chief financial officer Colette Kress has highlighted the company's commitment of nearly $50 billion to AI research labs, describing it as a meaningful but still modest portion of expected free-cash-flow.
What comes next?
With the acquisition, Nvidia aims to extend its influence beyond hardware into the software layer that powers AI development. The company has pledged to keep Hugging Face open to the wider AI community, suggesting that the platform will continue to serve as a neutral hub while Nvidia leverages its resources to accelerate model training and deployment across Europe and beyond.