Nvidia says it hasn't bought Hugging Face. Two outlets disagree about which one is right.

Nvidia says it hasn't bought Hugging Face. Two outlets disagree about which one is right.

Published: August 29, 2026 | Updated: August 29, 2026 | Category: AI | By Mahesh

Editor's note: As of publication, two major outlets have published conflicting accounts of whether a deal exists. This article lays out both accounts and what Nvidia's own confirmed statements actually say. It will be updated as the reporting resolves.

Nvidia has agreed to buy Hugging Face, the open-source AI model repository, for $12.9 billion, according to The Information's original report, published the evening of August 26 and citing a single unnamed person with knowledge of the agreement.^[1] Hours later, on the morning of August 27, Business Insider published a competing account stating Nvidia has been "in talks" to acquire Hugging Face at a valuation above $13 billion, but that "the companies have not yet reached a deal, and the talks could still fall apart," according to explainx.ai's timeline comparing the two reports.^[2] Neither Nvidia nor Hugging Face has issued an official statement confirming or denying either version, and both companies declined to comment when contacted by multiple outlets.

What both reports agree on is the shape of the deal, if and when it closes. Hugging Face, based in New York, operates what several outlets have described as a GitHub-like platform where developers and companies publish, discover and build on open-source AI models and datasets, according to CNBC's separate reporting, which cited a source confirming to CNBC directly that "acquisition [by Nvidia] has been part of ongoing and recent talks," without confirming whether those talks had concluded.^[3]

The Number That Makes This Deal Unusual

Whichever account turns out to be accurate, the reported price is the detail worth examining most closely. The Information itself had reported earlier the same week that Hugging Face's annualized revenue sits around $150 million, which puts the reported $12.9 billion purchase price at roughly 86 times current revenue, according to Storyboard18's reporting on the same figures.^[4] That multiple is extreme even by the standards of the current AI acquisition cycle, and it signals the deal, if real, is not being priced on Hugging Face's current financial performance at all, but on the strategic value of controlling the platform's distribution.

Hugging Face has previously turned down a much smaller offer from Nvidia on principle rather than price. The Financial Times reported in January that Hugging Face rejected a $500 million investment from Nvidia in late 2025, which would have valued the company at $7 billion, specifically because it did not want a single investor capable of exerting outsized influence over the platform's decisions, according to heise online's summary of the FT reporting.^[5] A full acquisition is, definitionally, the exact outcome that earlier rejection was designed to avoid, which is part of why some of the coverage of this reported deal has treated it with particular caution rather than as a straightforward confirmation of prior interest.

What Nvidia's Own Earnings Call Actually Confirms

While the Hugging Face reporting remains contested, Nvidia's second-quarter fiscal 2027 results, reported on the company's own earnings call the evening of August 26, are fully confirmed and worth reading directly for what they say about the company's acquisition and investment posture generally. According to the official transcript of NVIDIA's Q2 FY2027 earnings call, CFO Colette Kress reported total revenue of $96 billion for the quarter, more than doubling year over year, with data center revenue up 18% sequentially to $89 billion.^[6] Kress told analysts the company expects to grow revenue by approximately 70% in fiscal 2028, a figure she explicitly characterized as a supply-constrained outlook, meaning Nvidia's own guidance assumes the company could grow even faster if enough chip supply were available.

The transcript also confirms a detail directly relevant to how the Hugging Face reporting should be read. Nvidia disclosed on the call that it has committed $18 billion toward equity investments through fiscal 2027, according to the same Seeking Alpha transcript and corroborated by Storyboard18's reporting. A reported $12.9 billion Hugging Face acquisition would consume the large majority of that disclosed commitment in a single transaction, which is itself a reason to treat the deal's existence as significant news regardless of which outlet's account of its current status proves correct. Whether the deal has actually been signed or remains in active negotiation, the dollar figure being discussed is consistent with, not larger than, capital Nvidia has already told investors it plans to deploy.

Why Nvidia Would Want an Open-Source Platform It Doesn't Need to Own

The strategic logic behind the reported acquisition connects to a defensive concern that has become increasingly visible in Nvidia's public messaging this year. Several of Nvidia's own largest customers, including Anthropic, OpenAI, Google and Amazon, are simultaneously developing their own custom AI chips specifically to reduce their dependence on Nvidia GPUs, according to Fortune's reporting on the deal.^[7] A strong, widely-adopted open-source AI ecosystem works against that trend in Nvidia's favor, because developers downloading and running open-source models from a platform like Hugging Face still need to host and run those models on physical computing infrastructure, infrastructure that, for the overwhelming majority of current deployments, runs on Nvidia hardware regardless of which company designed the underlying model.

Owning the distribution layer itself, rather than merely investing in it, would give Nvidia direct visibility into which open-source models are gaining traction and how developers are actually deploying them, information with real competitive value as the open-weight ecosystem, increasingly populated by capable and inexpensive Chinese models from labs like DeepSeek, Moonshot and Z.ai, continues to grow. Fortune's reporting also noted a secondary strategic rationale: the acquisition would mark a return for Nvidia to cloud computing, a business the company had reportedly scaled back roughly a year earlier, and could give Nvidia a mechanism to offload unused cloud capacity from compute deals it has already guaranteed to customers.

How This Fits the Pattern Depth Grid Has Tracked All Month

This reported deal is the latest in a string of Nvidia investment and acquisition moves that Depth Grid has covered closely throughout August, and reading it against that pattern is useful context. Earlier this month, an SEC filing revealed Nvidia holds a $21 billion equity stake in SpaceX and a $30 billion stake in Intel, both companies that have separately pledged Nvidia chip exclusivity. Nvidia was also separately reported to be negotiating an investment in Perplexity at a $30 billion valuation the same week. If the Hugging Face deal is confirmed, it would represent a meaningfully different category of move than either of those, an outright acquisition of infrastructure rather than a minority equity position in a customer, which suggests Nvidia's capital deployment strategy is not limited to a single playbook. It is simultaneously taking equity stakes in customers, negotiating investments in fast-growing AI application companies, and now reportedly moving to acquire outright the open-source distribution layer that sits underneath much of the AI ecosystem's model access.

What to Watch Next

The most reliable next signal will be an official joint statement from Nvidia and Hugging Face, or, absent that, an SEC filing disclosing the transaction if it proceeds to close, similar to the disclosures that previously confirmed Nvidia's SpaceX and Intel positions. Business Insider's account specifically noted that Microsoft had separately met with Hugging Face about a potential deal, though those talks were reported as not currently active, a detail worth watching in case the eventual outcome differs from either outlet's current account. Until an official confirmation exists, both the "agreed" framing from The Information and the "still in talks" framing from Business Insider should be treated as competing, unconfirmed accounts of the same underlying situation, not as two separate events.

Common Questions

Sources

1. The Information, "Nvidia Agrees to Buy Open Source AI Platform Hugging Face For $12.9 Billion," August 26, 2026. Link
2. explainx.ai, "Nvidia Hugging Face $12.9B Deal Report (Aug 2026)," updated August 27, 2026. Link
3. CNBC, "Nvidia agrees to buy Hugging Face for $12.9 billion, report says," August 27, 2026. Link
4. Storyboard18, "Nvidia agrees to buy Hugging Face for $12.9 billion in major AI bet: Report," August 27, 2026. Link
5. heise online, "Report: Nvidia acquires Hugging Face for $12.9 billion," August 27, 2026. Link
6. NVIDIA Corporation, Q2 Fiscal Year 2027 Earnings Call Transcript, August 26, 2026, via Seeking Alpha. Link
7. Fortune, "Nvidia nears $12.9 billion deal to buy open-source AI platform, Hugging Face, report says," August 27, 2026. Link

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Article by Depth Grid News Desk | depthgrid.in