Nvidia reportedly set to acquire AI firm Hugging Face for $12.9 billion

Nvidia is reportedly poised to acquire the Franco-American artificial intelligence company Hugging Face for a staggering $12.9 billion, a move that would significantly enhance the chipmaker's footprint in the burgeoning open AI ecosystem.

The potential acquisition price represents a substantial increase from earlier negotiations, with The Information reporting the deal value. Previously, in late 2025, Nvidia had reportedly offered to invest $500 million in Hugging Face, which provides access to a vast array of AI models. This latest development signals Nvidia's strategic intent to deepen its involvement in the competitive AI landscape.

Hugging Face, established in New York in 2016 by three French entrepreneurs, champions the concept of "open AI." It positions itself as a community dedicated to building the future of AI by making open-source models, which can be downloaded and modified, accessible to a wider audience. This contrasts with the proprietary, closed models developed by companies like OpenAI and Anthropic.

The growing demand for AI agents, autonomous programs capable of performing tasks and self-correction, has driven up the need for computing power and associated costs. Consequently, many businesses and developers are turning to open models as a more economical option compared to closed AI systems. This trend has significantly boosted Hugging Face's user base, with the company valued at $4.5 billion in its last funding round in 2023.

Nvidia, known for its substantial quarterly revenues, has been actively investing in technology players, particularly startups, to foster AI development. The company's interest in Hugging Face underscores its commitment to nurturing an open AI ecosystem in the United States, complementing its own AI model development, such as Nemotron.