TheModelDesk

Nvidia has confirmed its acquisition of Hugging Face for $12.93 billion. The deal follows weeks of rumors and marks one of the largest transactions in the AI sector.

Hugging Face hosts more than 3 million models, 1 million applications and 500,000 datasets. Over 18 million developers use the platform. In a blog post, Nvidia CEO Jensen Huang said Hugging Face would continue serving the whole AI community as an open hub. Developers will keep free choice of models, frameworks, clouds, inference providers and computing platforms. Nvidia compute will not be required to build on or deploy through Hugging Face.

Huang emphasized Nvidia's own open-source contributions: the company has released more than 500 models and 250 open datasets on the platform. An open ecosystem under Nvidia's control also lets the company shape a platform optimized for its chips, and sell unused compute capacity to enterprise customers bundled with Hugging Face's offering.

Hugging Face was founded in 2016 and raised over $395 million in total, most recently $235 million in 2023 in a round led by Salesforce Ventures with participation from Google, Amazon, IBM and Nvidia. According to The Information, the company reached $150 million in annualized revenue and, per CEO Clem Delangue, was close to profitability. Last year Hugging Face reportedly rejected a $500 million offer from Nvidia. Delangue said on X that scaling open AI requires more compute, support, collaboration and visibility, which is why he approached Huang.

Huang has long advocated open-weight models, arguing they strengthen the US position against China and are vital for cybersecurity. Nvidia recently struck a $6 billion deal with coding startup Poolside to develop open models and says it has invested over $50 billion in AI frontier labs.