Coin Press - Nvidia to buy AI platform Hugging Face for $12.9 bn: report

The price is a marked increase from the $7 billion valuation that served as the basis for initial negotiations with Nvidia late last year, according to the Financial Times.

At the time, the AI platform reportedly turned down a $500 million investment from the California–based chipmaker.

The Information's report cited an unidentified person with knowledge of the agreement.

The two tech companies did not immediately respond to AFP's requests for comment.

Founded in 2016 in New York by three French entrepreneurs, Hugging Face -- whose name is inspired by an emoji -- describes itself as "the AI community building the future."

The company touts open models, which can be downloaded and modified, as opposed to closed models like those of rivals OpenAI or Anthropic.

The advent of AI agents capable of carrying out tasks autonomously has led to soaring demand for computing power.

More companies and software developers are turning to open models, which are often cheaper than their closed alternatives, to keep costs down.

Hugging Face, which was valued at $4.5 billion during its last funding round in 2023, has seen increasing traffic to its online software library.

Last month, two OpenAI models escaped the closed environment they were meant to stay in, got onto the internet on their own and broke into Hugging Face's internal systems.

The incident fed worries that AI giants cannot keep their own models under control, as similar episodes have been reported at Anthropic and China's Moonshot AI.

Nvidia is best known for its GPUs, specialised chips originally designed to render gaming graphics at high speed, which have more recently become the engine for chatbots and other AI tools.

L.K.Baumgartner--CPN