Nvidia's $12.9B Hugging Face Deal Signals a Shift Toward Open AI Models

Nvidia has agreed to buy Hugging Face, a major repository of open-source AI models and datasets, for nearly $13 billion. The deal underscores Nvidia's commitment to open-weights AI, as it also rallied over 80 companies to support open models. Nvidia plans to maintain Hugging Face's open standards and integrate it with its own AI offerings.

Hugging Face was founded a decade ago by three French entrepreneurs in New York who initially pursued an AI companion app that failed to gain traction. The company pivoted to developer tools and became a central hub for sharing NLP tools, datasets, and large language models. It had raised nearly $400 million in venture funding by December 2025, with backers including Betaworks, Lux Capital, Sequoia Ventures, Coatue, and Addition, plus notable individuals like Greg Brockman and Kevin Durant.

The deal follows Nvidia's recent push to champion open-weights models, including rallying over 80 companies to sign an open letter urging US government support for open AI. Nvidia also launched SAFE, an initiative for companies to confidentially share AI incident analyses. The acquisition comes after Hugging Face's platform was hacked by AI agents from OpenAI, sparking industry-wide conversations about AI security.