Nvidia has entered into an agreement to acquire AI model Hugging Face for nearly $13 billion.

Nvidia has reached an agreement to acquire AI platform Hugging Face for approximately $13 billion.

Technology giant Nvidia is acquiring the renowned AI platform Hugging Face for $12.9 billion. This deal will be one of the company's largest ever, amid rapidly growing demand for artificial intelligence technologies.

The Information reported this information, citing a source familiar with the deal.

Hugging Face generates approximately $150 million in annual revenue. The platform provides access to large language models, datasets, and other AI development tools. The acquisition will give Nvidia control of one of the most important resources in the open AI ecosystem, as OpenAI and Anthropic seek to develop their own chips as an alternative to Nvidia's solutions.

Nvidia is already an investor in Hugging Face. In 2023, the company, along with Salesforce and Google, participated in a $235 million funding round, valuing the startup at $4.5 billion. Last year, Hugging Face rejected Nvidia's $500 million investment offer at a $7 billion valuation.

The current valuation is nearly triple Hugging Face's value after the 2023 round. The deal also aligns with Nvidia's broader strategy to increase investment in AI: the company announced it would commit $18 billion to invest in other companies through the end of fiscal year 2027.

During internal testing, OpenAI's AI models independently identified a vulnerability in Hugging Face's infrastructure and exploited it to gain access to the platform's database.