SAEDNEWS: Nvidia announced plans to acquire AI startup Hugging Face for $12.9 billion, strengthening its position in open-source artificial intelligence.
According to Saednews, Nvidia has agreed to acquire Hugging Face, the leading platform for open-source artificial intelligence models and datasets, in a deal that could reshape the rapidly growing AI industry.
Hugging Face provides developers and companies with access to millions of AI models and datasets. Unlike closed AI systems operated by companies such as OpenAI and Anthropic, many of the models available through Hugging Face can be downloaded, customized and operated on a company's own infrastructure.
The company has become a major player in the debate over whether advanced AI technology should remain openly available or be kept behind closed systems to reduce the risk of misuse.
Hugging Face said open-source technology can offer companies greater control over their AI systems and, in some cases, allow sensitive or proprietary information to remain within their own infrastructure.
Nvidia CEO Jensen Huang has consistently supported the development of open AI models, arguing that greater openness can encourage innovation and contribute to AI safety.
The acquisition could also strengthen Nvidia's position as a key technology provider behind the global AI industry. Huang said the deal would help make Hugging Face's models available to an even larger number of developers and businesses worldwide.
Hugging Face currently serves more than 18 million developers and researchers, with more than 3 million AI models and approximately 200,000 enterprise customers on its platform. Nvidia had already published more than 500 open models on Hugging Face before announcing the acquisition.
Huang said Nvidia intends to maintain the platform's open approach and expand access to AI technology globally.
The announcement comes as Nvidia continues to benefit from enormous demand for AI computing infrastructure. The chipmaker recently reported quarterly sales of more than $96 billion, representing more than double the figure from the same period previously.
Despite Nvidia's rapid growth, investors remain concerned about how long companies will continue spending heavily on AI infrastructure and whether competitors will eventually challenge Nvidia's dominance.
Nvidia has invested heavily across the AI ecosystem, including funding AI research companies and providing financing to customers purchasing its chips to construct large-scale data centers.
Under the agreement, Nvidia will pay $11.9 billion to Hugging Face shareholders. The deal also includes an additional $1 billion in equity intended to retain Hugging Face employees who join Nvidia.
The acquisition is expected to be completed during the first half of next year, subject to the required conditions and approvals.
The transaction represents a significant increase over Hugging Face's $4.5 billion valuation in 2023, when the company raised $235 million.
Hugging Face previously rejected a $500 million investment from Nvidia that would have valued the company at around $7 billion. According to reports, the company wanted to preserve its independence at the time.
However, Hugging Face CEO Clem Delangue later said that he began pursuing a deal with Nvidia after concluding that open-source AI had reached a major turning point and required greater resources, scale and visibility.
The acquisition therefore represents more than a financial transaction. It could mark a new phase in the development of open-source AI, bringing Nvidia's enormous computing resources together with Hugging Face's global developer community and extensive collection of AI models.
