Key facts
- Nvidia is reportedly in talks to acquire AI platform Hugging Face.
- The potential acquisition values Hugging Face at over $13 billion.
- The companies have not yet finalized a deal, and negotiations could end.
- Nvidia previously invested in Hugging Face's 2023 funding round.
- Hugging Face previously rejected a significant investment offer from Nvidia.
Nvidia has been engaged in serious acquisition discussions with AI platform Hugging Face, with the potential deal valuing the company at over $13 billion, according to a report by Business Insider citing a person familiar with the matter. The two parties have not yet reached an agreement, and the talks could still fall apart.
Hugging Face is a central hub for the open-source AI ecosystem, hosting millions of AI models and datasets for developers. Acquiring the platform could significantly enhance Nvidia's presence among developers and potentially drive more workloads to its chips. However, ownership by Nvidia could also challenge Hugging Face's perceived neutrality, as it currently supports models and hardware from various industry players, including Nvidia's competitors like AMD and Intel.
Nvidia has been increasing its dealmaking activity, backed by a substantial cash reserve. The company stated it has $18 billion committed to equity investments for the remainder of its fiscal year, in addition to $47.9 billion already held in private companies. Microsoft had also held discussions with Hugging Face, though those talks are reportedly not ongoing.
Nvidia has an existing relationship with Hugging Face, having participated in its $235 million funding round in 2023, which valued the company at $4.5 billion. Previously, Hugging Face reportedly turned down a $500 million investment offer from Nvidia late last year that would have valued it at $7 billion, as the company sought to avoid a dominant investor influencing its decisions.