Nvidia is paying $12.93 billion for Hugging Face, but one of the most consequential terms of the deal is what Nvidia says it will not do with the platform: require developers to use its chips.
The chipmaker formally confirmed the acquisition Thursday, one week after the agreement was first reported, revealing that about $11.9 billion will go to Hugging Face stockholders and as much as another $1.0 billion will be reserved for equity-based employee retention. Nvidia entered into the definitive agreement on September 2.
The transaction would be Nvidia’s largest conventional acquisition, surpassing its $6.9 billion purchase of networking company Mellanox, announced in 2019 and completed in 2020.
Sponsored · Selkirk Copper Mines
It also represents a substantial premium for a company valued at $4.5 billion during its 2023 funding round. Reuters reported last week that Hugging Face had reached about $150 million in annualized revenue.
Hugging Face has become a central repository and development layer for open AI. Nvidia said the platform has more than 18 million developers, researchers, and creators, more than 200,000 corporate users, more than 3 million models, 500,000 datasets, and 1 million applications.
Owning that platform puts Nvidia deeper into the software and distribution side of AI at a time when several of its largest computing customers are investing in chips designed internally or with Nvidia competitors.
Reuters reported that Meta Platforms, Microsoft, and OpenAI are among the companies developing alternatives intended to reduce their reliance on Nvidia hardware. Hugging Face gives Nvidia exposure to developers regardless of which individual model ultimately dominates the market.
Sponsored · Cambria Gold Mines
But Nvidia has made hardware neutrality an explicit part of its post-acquisition commitment.
“NVIDIA compute will not be required to build on or deploy through Hugging Face,” CEO Jensen Huang said.
The company said Hugging Face will continue supporting different AI models, cloud providers, and computing platforms. More importantly, the commitment also appears in Nvidia’s SEC filing, which says the platform will continue supporting other silicon vendors.
That means competitors including AMD, itself an existing Hugging Face investor, are not being formally shut out of a platform that has become important infrastructure for open-model development.
The acquisition is expected to close in the first half of 2027 and remains subject to required regulatory approvals.
Nvidia’s filing also identifies government restrictions on open-source AI as a specific transaction risk. The company said many widely used open models originate in China and warned that restrictions based on where models are developed could materially affect both Hugging Face and Nvidia.
The company is acquiring the platform through which millions of developers distribute and customize models while committing to keep that platform available to hardware, software, and model competitors.
The $12.93 billion purchase therefore gives Nvidia ownership of a major piece of open AI infrastructure without, at least under its disclosed commitments, turning that infrastructure into a closed Nvidia distribution channel.
