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Why would Nvudua want to own Hugging Face? Do they make money, or have a solid plan to make money?
Nvidia wants Hugging Face to control the distribution channel for open-source AI and protect its chip dominance as big labs build their own silicon — not for Hugging Face's revenue, which is real (~$150 million, near-profitable) but tiny next to a $12.9 billion price.
Why it matters: The deal would hand the dominant chipmaker the gatekeeper role over the platform where most of the industry shares and runs open AI models.
- Hugging Face does make money: about $150 million in annualized revenue, up from roughly $100 million two months earlier, with 2,000+ paying enterprise customers and the CEO saying it is 'close to profitability' [techcrunch.com](https://techcrunch.com/2026/08/26/nvidia-closes-in-on-hugging-face-acquisition/), [tradingkey.com](https://www.tradingkey.com/analysis/stocks/us-stocks/262135106-nvidia-129-billion-hugging-face-what-is).
- But $12.9 billion is roughly 86 times that revenue — one analyst calls it 'a strategic premium on distribution,' not a software valuation [infoworld.com](https://www.infoworld.com/article/4214823/nvidia-eyes-12-9-bn-hugging-face-deal-to-expand-ai-platform-control.html), [techspot.com](https://www.techspot.com/news/113640-nvidia-closes-129-billion-hugging-face-acquisition-neutrality.html).
- The strategic logic is chip protection: OpenAI, Google, Amazon, and Anthropic are all building their own AI chips, so Nvidia wants a thriving open-source ecosystem that keeps more of the market dependent on its hardware [techcrunch.com](https://techcrunch.com/2026/08/26/nvidia-closes-in-on-hugging-face-acquisition/).
- Owning the hub also gives Nvidia sway over which hardware developers run their models on, a cheap way back into cloud computing after scaling back DGX Cloud, and an outlet to sell unused cloud capacity Nvidia is already on the hook for [businessinsider.com](https://www.businessinsider.com/hugging-face-nvidia-deal-reshape-ai-landscape-2026-8), [techcrunch.com](https://techcrunch.com/2026/08/26/nvidia-closes-in-on-hugging-face-acquisition/).
Room for disagreement
- Neutrality is the core risk: Hugging Face's value rests on sitting above the hardware fight, and analysts warn that Nvidia owning it could push developers toward AMD, AWS, and Google — though most expect Nvidia to preserve openness initially to avoid destroying the asset [businessinsider.com](https://www.businessinsider.com/hugging-face-nvidia-deal-reshape-ai-landscape-2026-8), [infoworld.com](https://www.infoworld.com/article/4214823/nvidia-eyes-12-9-bn-hugging-face-deal-to-expand-ai-platform-control.html).
- Coverage also differs on the deal's status: The Information reports an agreement, while Business Insider says talks could still fall apart [businessinsider.com](https://www.businessinsider.com/nvidia-in-talks-to-buy-hugging-face-13-billion-dollars-2026-8).
AI-generated with web search — may be wrong. Check the linked sources.
