The chip giant's near-$13bn move for the 'GitHub of AI' marks its boldest step yet beyond silicon and into the software layer that runs on it.
Nvidia (LSE: NVDA) has struck one of its largest-ever deals, agreeing to buy open-source AI hub Hugging Face for $12.93bn, a move that pushes the world's most valuable company further up the artificial intelligence value chain and closer to the software that ultimately runs on its chips.
Shares in Nvidia rose overnight on news of the acquisition, with the market reading the deal as a smart hedge against slowing chip sales rather than another burst of unchecked AI spending. AJ Bell's head of financial analysis, Danni Hewson, said investors had grown wary of hyperscalers' cash burn but welcomed a purchase that helps insulate Nvidia's business, particularly as some of its biggest customers are now developing their own semiconductors in-house.
Hugging Face, often described as the 'GitHub for AI', hosts more than 3 million models, 500,000 datasets and 1 million applications, and is used by over 18 million developers and 200,000 companies. Nvidia chief executive Jensen Huang said the tie-up would help scale the platform and widen access to AI tools for developers and institutions globally, cementing Nvidia's ambitions to control more of the AI stack beyond pure hardware.
Founded in 2016, Hugging Face was last valued at around $4.5bn in a 2023 funding round in which Nvidia itself was an investor, and is reported to generate annualised revenue of roughly $150m. The scale of the uplift underlines how quickly valuations for AI infrastructure and distribution platforms have inflated as the sector has matured.
The acquisition is expected to complete in the first half of 2027, subject to regulatory approval, leaving plenty of time for scrutiny given Nvidia's dominant position in AI hardware and the strategic significance of owning a platform through which developers discover and distribute open models.
This report is based on Nvidia’s announcement and coverage by UK Investor Magazine. Company announcements can be tracked via London Stock Exchange RNS and Investegate, and the full results calendar is worth watching for the next update.
This article is for general information only and does not constitute investment advice or a recommendation to buy or sell any security. Photo: Taylor Vick on Unsplash.
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