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Nvidia Agrees to Buy Open Source Platform Hugging Face For $12.9 Billion

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“Aug 26 (Reuters) - Nvidia has agreed to buy AI platform Hugging Face for $12.9 billion, The Information reported on Wednesday, citing a person with knowledge of the deal.
The chipmaker and New York-based Hugging Face, which hosts open-source large language models and datasets, did not immediately respond to Reuters requests for comment outside regular business hours.
Nvidia was among the backers, alongside Salesforce and Alphabet's Google, that backed Hugging Face in a $235 million funding round in 2023 that valued the company at $4.5 billion.

The Financial Times reported in January that Hugging Face last year rejected a $500 million investment offer from Nvidia that would have valued it at $7 billion.

Nvidia on Wednesday forecast a 70% jump in revenue next fiscal year, underscoring unabated demand for AI computing. Nvidia also said it has $18 billion committed to equity investments for the rest of 2027 fiscal year.
(Reporting by Carlos Méndez in Mexico City; Editing by Rashmi Aich and Subhranshu Sahu)“

Source: https://lufkindailynews.com/news_re...cle_befd777c-9a61-5feb-8723-289b1e68c1f5.html
 
I don't see how this could be good. For 12.9 billion, they are going to want ROI, so I am interested in what that model (pun intended) they plan to use to recoup that.

Given that Nvidia really likes proprietary moats, this concerns me.
 
sc5mu93 said:
I don't see how this could be good.
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Nvidia is pushing for openSource and open competition on the LLM-software stack a lot, because the alternative tend to be Google running google models on google hardware, OpenAI running OpenAI on OpenAI hardware and so on.

That why they are almost the only open source LLM (not just openWeight) of any major player, they push neocloud that have zero special affiliation outside just running model for any clients.

Because and has long they can make money on the hardware, they will love an software side that can run on anything and they stay confident they will offer the best solution to run those.

As long hardware margin are high and that this world stay open that will continue to be their strategy, they will push for open LLM models, open software stacks they helped created and boost (TensorRT, triton, Nemo), independant clouds, local personal server and so on.

The cheapest the stack above it the more people will use, the more they will buy compute, the more open and the less Amazon model running on amazon chips, the better for the general run everything hardware solution they make.
 
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One day, all the major integrator will have "good enough" inference hardware to consider ditching Nvidia we can imagine, some Nvidia will start competing with them, probably at first by becoming a seller of compute instead of hardware, making their own supercomputer they loan...

And probably start making their own LLM if all the best one do not run on Nvidia anymore and becoming a competitor there, if that happen, one think for sure they will protect themselve, plan and be ready for both level.
 
1787847818191.png
 
Oh for fuck's sake. Great, the company that never met a proprietary standard it didn't like from PhysX, GSync, RTX-related everything, DLSS, and more, (and for awhile forced its customers to not be able to use their own 'superior' GPUs along with the cheaper, equal-or-better performance, open FreeSync monitors despite no technical blockers, to just name one issue) is now going to be grabbing hold of the largest place that handles a lot of the LoRAs, other weights, model distribution etc..and generally allows access to open, self-hosted AI/LLM tech.. While there is the potential they'l just sit back and collect the check, but I'm waiting to see that anything that allows "Open, but also lets it work on non-Nvidia hardware" to end up somehow being hobbled, or DMCA'd or something else. I have zero trust in Nvidia to allow true openness to flourish as opposed to "Well its technically open, but it only REALLY works on our hardware or with our other tech". They've had multiple opportunities to push for true openness over the years and there isn't even a Linux driver that's at at parity with AMD's as of yet despite the massive finances NV has available.

Consider me extremely skeptical that this isn't going to be things that favor NV hardware or using NV created APIs or standards and if there's any serious competition elsewhere, be it hardware or software related, it won't be given the equal chance. its all well and good to sit on top and talk about openness when it only really drives people towards your ecosystem, as opposed to really give them the chance to make use of some stellar open tech that could actually let them hop out of the pool they control.
 
RanceJustice said:
While there is the potential they'l just sit back and collect the check,
Click to expand...
that seem impossible, this is a strategic acquisition for sure and HuggingFace make little revenue for the moment.

One thing is certain, HuggingFace cloud providing of LLM service and others will continue to run mostly on Nvidia hardware, but they will continue for a while to offer a vast array of solution and try to appear a bit neutral and their big strength in that space now is how much they appear multi-vendor and extremely open.

Here open source model is so well aligned with Nvidia business model that there is a chance that this is a giant injection in the open source ecosystem to counterbalance the closest weight and the non open source only open weight outthere.

I am sure lot of fear when microsoft bought Github, about none occurred and GitHUb still fully open to easily run your stuff on AWS or google cloud.

One big possible advantage here, it give Nvidia a deep and early knowledge to a lot of openSource projects... they will be able to optimise their driver-hardware for them and vice-versa it will continue to be super easy and natural for openSourcer to optimise on Nvidia.
 
sc5mu93 said:
I don't see how this could be good. For 12.9 billion, they are going to want ROI, so I am interested in what that model (pun intended) they plan to use to recoup that.

Given that Nvidia really likes proprietary moats, this concerns me.
Click to expand...
You own NVidia stock?

If not, Jensen probably has money oozing out all his pores and needs somewhere to put it all? Or just drunk with "power."
 
I suspect NVidia wants AI to be more open. Something you can run on your own hardware, personal or corporate, and rented cloud hardware. If a few giant tech companies manage to lock it up as an online service NV will probably get cut out of the hardware stack eventually. All the other giant tech companies are looking to maximize profits, and they have the resources to design their own hardware, shift the whole stack off of NV, and not share any $ with NV. They're already working on it. OTOH if NV establishes themselves as the preferred choice for on-prem, laptop and desktop AI, perhaps they can be sticky like Intel and Windows. Somehow Intel still has a larger market share than AMD in CPUs, and despite decades of people complaining about it Windows is still the #1 desktop/laptop OS. IMHO long term NV is much better off trying to be the biggest player in a world of distributed AI than they are getting in bed with Anthropic, OpenAI, Google, etc. because the tech giants will just stab them in the back.
 
Thought about it some more. Really wanted to figure out how hugging face fits in with Nvidia . This is all speculation, and probably bad speculation but leather jacket man pushes the envelope so to speak.

As we're seeing openAi and anthropic keep raising prices to cover their costs and debts. Eventually, you may see a tipping point to where the software stack and open weight models do well enough to move people away from frontier Labs.

Nvidia controls the main repository for open weight models on the Internet. Likewise they have a ton invested in these frontier Labs and hyper scalers. They have limited the supply of their consumer cards to keep the prices high and limit the economic advantage of open weight at home .

Seems to me they are purposefully drying up the consumer space to protect their investments in these other companies, and I THINK with the call to regulate LLMs/AI, Jensen (plus altman Dario etc) will call up friends in the admin and make unregulated AI (e.g. models downloaded from the Internet) illegal for SAFETY. ONLY hugging face, owned by Nvidia will meet regulatory muster, and the enshitification open weight begins, pushing consumers BACK to frontier.
 
sc5mu93 said:
Thought about it some more. Really wanted to figure out how hugging face fits in with Nvidia . This is all speculation, and probably bad speculation but leather jacket man pushes the envelope so to speak.

As we're seeing openAi and anthropic keep raising prices to cover their costs and debts. Eventually, you may see a tipping point to where the software stack and open weight models do well enough to move people away from frontier Labs.

Nvidia controls the main repository for open weight models on the Internet. Likewise they have a ton invested in these frontier Labs and hyper scalers. They have limited the supply of their consumer cards to keep the prices high and limit the economic advantage of open weight at home .

Seems to me they are purposefully drying up the consumer space to protect their investments in these other companies, and I THINK with the call to regulate LLMs/AI, Jensen (plus altman Dario etc) will call up friends in the admin and make unregulated AI (e.g. models downloaded from the Internet) illegal for SAFETY. ONLY hugging face, owned by Nvidia will meet regulatory muster, and the enshitification open weight begins, pushing consumers BACK to frontier.
Click to expand...
Honestly, Nvidia likely has too much cash on hand to the point where it's a liability, and they need some expenditures on the books to dodge taxes.
Jensen could have just put up a wall of company logos doing AI-related things and thrown a dart, with the agreement with accounting that they would buy what it landed on.

As a fun game, we should see if there were any dart-related injuries in the weeks or months leading up to the announcement....
 
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sc5mu93 said:
Thought about it some more. Really wanted to figure out how hugging face fits in with Nvidia . This is all speculation, and probably bad speculation but leather jacket man pushes the envelope so to speak.

As we're seeing openAi and anthropic keep raising prices to cover their costs and debts. Eventually, you may see a tipping point to where the software stack and open weight models do well enough to move people away from frontier Labs.

Nvidia controls the main repository for open weight models on the Internet. Likewise they have a ton invested in these frontier Labs and hyper scalers. They have limited the supply of their consumer cards to keep the prices high and limit the economic advantage of open weight at home .

Seems to me they are purposefully drying up the consumer space to protect their investments in these other companies, and I THINK with the call to regulate LLMs/AI, Jensen (plus altman Dario etc) will call up friends in the admin and make unregulated AI (e.g. models downloaded from the Internet) illegal for SAFETY. ONLY hugging face, owned by Nvidia will meet regulatory muster, and the enshitification open weight begins, pushing consumers BACK to frontier.
Click to expand...

I think it's more Nvidia doesn't want to tie their hardware to someone else's/another company's software (incase they go bust or whatever) so they wanted a software (and what's better than 1 SW is a SW repository of many SW you don't even have to really maintain as it's open source) of their own to keep selling HW

Nvidia hasn't been down with the regulate AI movement Jensen's been vocally against it
 
kram182 said:
I think it's more Nvidia doesn't want to tie their hardware to someone else's/another company's software (incase they go bust or whatever) so they wanted a software (and what's better than 1 SW is a SW repository of many SW you don't even have to really maintain as it's open source) of their own to keep selling HW

Nvidia hasn't been down with the regulate AI movement Jensen's been vocally against it
Click to expand...
So is the CCP, and they have made it clear that they will not abide by any calls to curb it, and they are still trying to catch up to Nvidia with their internally developed options.
 
kram182 said:
I think it's more Nvidia doesn't want to tie their hardware to someone else's/another company's software (incase they go bust or whatever) so they wanted a software (and what's better than 1 SW is a SW repository of many SW you don't even have to really maintain as it's open source) of their own to keep selling HW

Nvidia hasn't been down with the regulate AI movement Jensen's been vocally against it
Click to expand...
Nvidia isn't tied to anyone else's software company - it's the complete opposite right now. ALL of them are tied to Nvidia. Nvidia also has all their own models. If the economics were right, I would guarantee you that Jensen would fully vertically integrate and compete against his customers.

Nvidia will be for regulation when it benefits them. It's coming, just wait. He has Trumps personal phone number. Any regulation will work out to LeatherJacketMan's benefit.
 
sc5mu93 said:
Nvidia isn't tied to anyone else's software company - it's the complete opposite right now. ALL of them are tied to Nvidia.
Click to expand...

It works both ways - no SW no HW need - no HW nothing to dev SW on

sc5mu93 said:
Nvidia also has all their own models.
Click to expand...

And now they skirt any/all concerns of that (so to speak) by going "look how we foster and support open source stuff we don't dev ourselves"
 
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sc5mu93 said:
As we're seeing openAi and anthropic keep raising prices to cover their costs and debts. Eventually, you may see a tipping point to where the software stack and open weight models do well enough to move people away from frontier Labs.
Click to expand...
They are both cutting price at incredible pace, using the very frontier at high or max can cost a lot.... but they have lower cost options:

1791028228683.png


GPT-6 Luna/Sol are quite competitive price wise with openModels, Sonnet models has well.


sc5mu93 said:
Seems to me they are purposefully drying up the consumer space to protect their investments in these other companies, and I THINK with the call to regulate LLMs/AI, Jensen (plus altman Dario etc) will call up friends in the admin and make unregulated AI (e.g. models downloaded from the Internet) illegal for SAFETY. ONLY hugging face, owned by Nvidia will meet regulatory muster, and the enshitification open weight begins, pushing consumers BACK to frontier.
Click to expand...
That a bit the exact opposite, big frontier (google-openAI-anthropic-SpaceX-meta) are all actively working on their own silicon to run their own models, Google for a long time but now: https://openai.com/index/jalapeno-first-results/, https://www.tomshardware.com/tech-i...ng-with-the-claude-ai-maker-for-manufacturing, https://about.fb.com/news/2026/04/meta-partners-with-broadcom-to-co-develop-custom-ai-silicon/

Nvidia are putting money in the neo-cloud business and the open source business to make sure the competition to the frontier lab stay strong and alive, to have models that do not run own their own custom ASIC made by a vertical giant (i.e. that still use Nvidia) to be a popular option.... and to be ready to become a inference datacenter builder and seller on their own LLM if needed.

They much prefer if people buy this:
https://www.servethehome.com/taking-an-up-close-look-at-the-supermicro-gb300-super-ai-station/

And run an open model themselve, much more money for them than if people share the same gpu in a very efficient way.

Their investment are tiny versus their now over $400 billions a year revenues and their own valuation, they much prefer Nvidia (i.e. possibly only the open source world that will use them at some point) to win than OpenAI-Anthropic-Google becoming the only games in town that run on non Nvidia hardware.
 
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