Nvidia to Acquire Hugging Face for $12.93B — Its Second-Largest Deal Ever at ~2.9x Last Valuation — as the Chipmaker Buys the 'GitHub of AI' While Model Labs Build Their Own Chips

WHAT HAPPENED: Nvidia announced this morning (Sep 3) that it has agreed to acquire Hugging Face for $12.93 billion, via an official NVIDIA blog post from Jensen Huang and a CNBC Squawk Box interview with Hugging Face CEO Clément Delangue. The deal timeline moved fast: Business Insider first reported HF working with a bank on a ~$13B sale on Aug 23; The Information reported an agreed $12.9B deal this week; confirmation came today. Delangue says HE approached Huang over the summer — "I think we realized that Hugging Face and open source AI in general was at the turning point, and that it needed more, more resources, more scale, more visibility" — adding Nvidia was "a perfect home" and that talks moved quickly.

KEY METRIC: $12.93B purchase price vs Hugging Face's last official valuation of $4.5B (2023 funding round Nvidia itself participated in) = 2.87x markup. Against ~$150M annualized revenue (The Information), Nvidia is paying roughly 86x sales. It is Nvidia's second-largest acquisition on record, behind only the $20B purchase of Groq assets in December 2025; Mellanox ($7B, 2019) was the previous peak.

COMPARISON: The FT previously reported Hugging Face REJECTED a $500M Nvidia investment last year that would have valued it at $7B — over concerns about a single dominant investor. Twelve months later, HF accepted full ownership at nearly double that valuation. The deal extends a remarkable balance-sheet offensive: Nvidia's Q2 FY27 revenue hit $96.2B (+18% QoQ), it has committed up to $100B to OpenAI data-center capacity, and its new "repeatable financing platform" with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs and KKR targets mobilizing $500B+ in third-party AI-infrastructure capital.

WHY IT MATTERS: This is vertical integration up the AI stack. As closed-model leaders OpenAI, Anthropic and Google push to build their own chips, Nvidia just bought the neutral distribution layer of open-source AI — the platform where the ecosystem's long tail hosts models, datasets and tools. Huang explicitly pledged openness: "Hugging Face will remain an open platform for the entire AI ecosystem... Developers will choose the models they want, the frameworks they want, the clouds and inference service providers they want... Nvidia compute will not be required to build on or deploy through Hugging Face." Whether that promise holds is now the single biggest trust question in open-source AI. NVDA shares edged higher on the news.