NVIDIA is about to buy HuggingFace - DTNS 5341

**Tom Merritt** (0:08)
This is the Daily Tech News for Thursday, August 27th, 2026 We tell you what you need to know, give you important context, and help you understand so you're not left in the dark.

**Huyen Tue Dao** (0:17)
Well, today, Nvidia is about to buy HuggingFace, and HuggingFace made a dancing robot duck.

**Tom Merritt** (0:24)
I'm Tom Merritt.

**Huyen Tue Dao** (0:25)
I'm Huyen Tue Dow.

**Tom Merritt** (0:26)
And if you're watching the video version, I am very proud that Huyen Tue Dow is now the second person on DT&S to be engaging in the TimeShifter app's jet lag preparation fully in the dark, in the middle of the show, on purpose.

**Huyen Tue Dao** (0:43)
On purpose. This is not a look I'm trying. I'm not trying to be cool. And I do have my lights on in the back, but now I just look like a witness in like a true documentary.

**Tom Merritt** (0:54)
I am pro-normalizing TimeShifter darkness. I can't wait to hear how this works for you once you get back from YouTube.

**Huyen Tue Dao** (1:01)
I did subject you all to this because Tom had already done this, so I figured if Tom's doing it, I'm going to do it too. So there you go.

**Tom Merritt** (1:08)
All right. So more to come on that in the future. But for now, let's start with the big story.
The information says, and this could happen at any time. So by the time we publish this, maybe it's official, but Nvidia seems to have agreed to acquire HuggingFace. HuggingFace, the open source platform for LLMs and machine learning models. A lot of times people call it the GitHub for AI. Now Business Insider was saying that the deal wasn't quite done, but Nvidia didn't address reporter questions about it. And the company usually does if a report is inaccurate. They usually come back with like, yeah, that's not happening. That tells me that the deal is all but technically done. And we have a theory on why we might not be, have been hearing about this right away. If you don't know HuggingFace, HuggingFace is a place to find thousands of pre-trained models, some of which you can actually try out in the browser, also has lots of data sets you can use to train and test models. It's open source playground for AI. Nvidia wants to encourage a vibrant open source market. They've been talking about that nonstop lately. And the reason they want to do that is cause so they can sell chips to the people who run those open source models.
Especially as the big foundational models companies have started to design their own chips. Nvidia is like, we not only want to broaden the market, we want to make sure that we've got lots of customers and we're not locked into one customer that then changes their mind.
Nvidia has also been scaling down its DGX Cloud product, but HuggingFace could turn that around. It could boost it or potentially even become it, and just DGX Cloud and HuggingFace merge. As for HuggingFace itself, it gets the more generous funding available from within Nvidia's little waterfall of cash that's been going on, as well as access to all those servers. But why now? HuggingFace had turned down a large investment from Nvidia earlier this year, because it didn't want one dominant investor. But apparently, another company came knocking to buy HuggingFace. HuggingFace apparently has been entertaining offers. That caused Nvidia to step up. And if there was another offer, and Nvidia is making sure that it's giving HuggingFace's investors the superior offer, and dotting i's and crossing t's, that might be why we don't have the official announcement right now as we're recording.

**Huyen Tue Dao** (3:30)
Oh, I kind of have an image of like that scene from The Graduate, where Nvidia is Dustin Hoffman, a glass and HuggingFace is, and I forgot the character's name. I was like, no.

**Tom Merritt** (3:41)
Mrs. Robinson?

**Huyen Tue Dao** (3:42)
No, Mrs. Robinson's daughter. Anyway, yes, I had that kind of image when I was reading this.

**Tom Merritt** (3:49)
Yeah, it was the daughter.

**Huyen Tue Dao** (3:50)
You're right.

**Tom Merritt** (3:50)
Yeah. Well, I don't know which one of them had the money. I think it was Mrs. Robinson in that case, but Nvidia certainly has the money.
Nvidia reported its revenue is up 106 percent year over year last quarter.
Net income up 126 percent projected. Revenue is going to grow 70 percent in 2028, which sounds small compared to the 106 percent and 126 percent. But it's because Nvidia is also dealing with the rising component prices.
Their profit was $2.22 a share this last quarter. All of that beat expectations. In other words, the bubble not showing signs of bursting yet, not in this past quarter. CEO Jensen Huang seems to believe we haven't even reached the peak yet. He told investors in the Nvidia earnings call, I think the most important thing that matters for the industry is that, one, AI is doing productive and useful work. Two, AI is generating profitable tokens. And three, if we had more compute, we could generate more profitable tokens, which results in more profit for all of the services. This is the exact phase where we are at, he said. If you need me to translate that, he's saying LLMs and agents are actually making the end users money. And if we could deliver more capacity to run them, they would make even more money. Meaning the service providers would also make more money and then have to buy more Nvidia chips. And while HuggingFace doesn't solve the compute shortage, it does make sure Nvidia can foster continued users. So a big day, big day in the consolidation. We're seeing OpenRouter getting bought by Square. Looks like we're seeing HuggingFace getting bought by Nvidia.