Rumor has it that Nvidia (NVDA.US) is negotiating to buy the AI open source community Hugging Face with a valuation of over $13 billion

The Zhitong Finance App learned that, according to reports, Nvidia (NVDA.US) has conducted serious negotiations over the past few weeks to acquire the AI open source community Hugging Face, and the proposed deal values the latter at more than 13 billion US dollars. The two sides have yet to reach an agreement, and negotiations are still likely to break down. Furthermore, people familiar with the matter said that Microsoft (MSFT.US) has also contacted Hugging Face, but negotiations are not continuing.

Hugging Face was founded in 2016 in New York, and its first product was a chatbot. Currently, Hugging Face is considered the “GitHub of the artificial intelligence (AI) world,” and developers can publish, download, and fine-tune open source models on its platform. According to reports, its platform hosts more than 3 million public models, and the number of data sets exceeds 1 million. The company's revenue mainly comes from paid subscription services, enterprise hosting, and computing power services, but the government has never disclosed specific revenue figures.

If Hugging Face can reach a deal with a valuation of 13 billion US dollars, it means that the company's valuation will nearly triple within three years, and it will be another major event in the recent AI middle class acquisition boom. For Nvidia, owning this platform allows Nvidia to gain a greater foothold among these developers and potentially shift more workloads onto its chips. But Nvidia's ownership could also threaten one of Hugging Face's strengths — neutrality. The platform supports models and hardware across the industry, including Nvidia's competitors such as AMD (AMD.US) and Intel (INTC.US).

According to previous reports, at the end of last year, Hugging Face rejected Nvidia's $500 million investment offer, which would value the company to $7 billion. Hugging Face said at the time that it did not want a dominant investor that could influence decisions.

The last time Hugging Face received external financing was in 2023, when the company completed $235 million in financing led by Salesforce Ventures, with a valuation of $4.5 billion. Nvidia, Google, Amazon, Intel, Qualcomm, and IBM all participated in this round of financing, while Sequoia Capital and Lux Capital were its early investors.

Also, according to The Information, Hugging Face's annualized revenue growth rate increased by 50% in just two months, surpassing 150 million US dollars. According to the report, Hugging Face's revenue in 2023 reached about 70 million US dollars, revenue in 2024 was about 130 million US dollars, and now it has exceeded 150 million US dollars, which means that the company has almost doubled its revenue in less than two years.

Hugging Face uses a free+value-added business model, and about 3-5% of users switch to a paid plan. The paid plan provides enhanced capabilities for high usage scenarios and enterprise features. The platform hosts hundreds of thousands of models, serves tens of thousands of organizations, and has grown to more than 2,000 paying customers.

It is worth mentioning that Hugging Face's ambition is not limited to providing AI platform services. The company acquired French humanoid robot developer Pollen Robotics in April 2025 to add an open source robot circuit to the software business. Meanwhile, Hugging Face is getting a lot of attention due to safety issues. In July of this year, OpenAI revealed that its AI model got out of control during internal evaluation tests and invaded Hugging Face's system. The incident raised concerns about AI models: they could break through human-set control limits and access external systems. In June of this year, network security company Pluto Security also revealed a serious vulnerability in the Transformers library on Hugging Face. The malicious model may execute the attacker's code during normal loading.