Nvidia to buy Hugging Face for $12.9 billion

Nvidia's acquisition of Hugging Face for $12.9 billion invites comparison with its largest completed acquisition, Mellanox, bought for about $6.9 billion in 2019. That deal proved transformative: the networking business anchored by Mellanox generated $31.4 billion in revenue in fiscal 2026, more than four times the purchase price. Networking revenue grew from $8.6 billion in fiscal 2024 to $13 billion in fiscal 2025, then to $31.4 billion in fiscal 2026, with growth accelerating from 51% to 142%.

Hugging Face's scale helps explain the interest. More than 18 million developers, researchers, and creators use the platform to share more than 3 million models and 500,000 datasets. The Information reported in August that annualized revenue had climbed 50% in two months, to more than $150 million, putting the acquisition at around 86 times reported annualized revenue.

The bet is that Hugging Face pays off indirectly, the way Mellanox did. The Mellanox deal worked because networking became integral to Nvidia's AI data center systems, not because Mellanox grew as a separate business. Similarly, owning the platform where developers choose models could keep them and their compute budgets on Nvidia's hardware. The $12.9 billion price is small relative to Nvidia's scale—it generated $96.2 billion in revenue in the fiscal second quarter alone—so the outcome likely hinges on whether platform ownership translates into sustained chip and system sales.