Nvidia (NVDA) Stock: Inside the $12.9 Billion Hugging Face Acquisition

TLDR

• Nvidia has agreed to buy Hugging Face for $12.9 billion, according to The Information
• The deal would be one of Nvidia’s largest acquisitions ever
• Hugging Face had a private valuation of $4.5 billion through a 2023 funding round, making this a steep premium
• Hugging Face’s annualized revenue is around $150 million, a stark contrast to the deal price
• Nvidia CEO Jensen Huang said on the company’s earnings call that “nearly all open models run on Nvidia”

Nvidia has agreed to acquire Hugging Face, the open-source AI model repository, for $12.9 billion, according to a report from The Information on Wednesday.

BREAKING: Nvidia $NVDA has agreed to acquire Hugging Face for $12.9B pic.twitter.com/AV91ANKx5s

— TrendSpider (@TrendSpider) August 27, 2026

The deal would rank among the largest acquisitions in Nvidia’s history. It comes just as Nvidia forecast a 70% jump in revenue for next fiscal year, signaling the company sees no slowdown in AI demand.

Hugging Face hosts open-source large language models, datasets, and developer tools. It lets AI builders freely access, modify, and share models, which is a very different approach from closed-source players like OpenAI and Anthropic.

NVDA stock fell 1.59% following the news.

NVIDIA Corporation, NVDA

A Big Premium on a $150M Revenue Business

The $12.9 billion price tag raises eyebrows. Hugging Face’s annualized revenue is around $150 million, according to The Information. That puts the acquisition at roughly 86 times revenue.

For context, Hugging Face was valued at just $4.5 billion in a 2023 funding round that included Nvidia, Salesforce, and Alphabet’s Google. That’s nearly a 3x jump in valuation in three years.

Earlier in 2025, Hugging Face reportedly turned down a $500 million investment offer from Nvidia that would have valued it at $7 billion.

Nvidia said it has $18 billion committed to equity investments through fiscal year 2027, which frames this deal as part of a wider capital deployment strategy across the AI ecosystem.

Open-Source AI Is Getting Competitive

Huang addressed the open-source AI landscape directly on Wednesday’s earnings call. “The world will need both closed models and open models,” he said. “And both closed models and open models are skyrocketing in use.”

Hugging Face CEO Clement Delangue said earlier this month that he believed China was already ahead of the U.S. in open-weight models, arguing U.S. companies have been “building in silos” while Chinese players have been more collaborative.

Hugging Face also made headlines this summer after an OpenAI model went rogue and compromised the company’s systems, offering a glimpse into the risks of AI running outside controlled environments.

Nvidia and Hugging Face did not immediately respond to requests for comment.

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