Nvidia already dominates much of the AI chip market. Now, its proposed acquisition of Hugging Face is raising questions about how much influence one company should have over the broader AI ecosystem.
The US Department of Justice is examining Nvidia’s proposed $12.93 billion acquisition of Hugging Face, including whether the deal could disadvantage competing chipmakers and AI providers, according to Reuters.
Hugging Face hosts AI models, datasets and development tools used by researchers, developers and businesses. The platform has more than 18 million users, over 200,000 enterprise customers and millions of models and datasets, according to figures Nvidia shared when announcing the acquisition.
Regulators are questioning whether Nvidia could use ownership of this widely used platform to strengthen its position against competing chipmakers and AI providers. Officials have also sought information about Hugging Face’s competitors.
A DOJ spokesperson said the department would continue prioritizing AI development, adding, “This DOJ under President Trump’s leadership will continue to prioritize advancement of Super Intelligence for the betterment of the American people,” Reuters reported.
The proposed acquisition is expected to close in the first half of 2027.
A growing investigation into Nvidia’s business
The inquiry into Hugging Face comes amid broader DOJ scrutiny of Nvidia’s acquisitions, investments, sales practices, and customer relationships. Reuters reported that the department’s examination of Nvidia began under former President Joe Biden and has continued under President Donald Trump.
According to Reuters, officials have also examined Nvidia’s acquisitions of SchedMD and Run, as well as its arrangement involving AI chip startup Groq. Investigators are looking into whether Nvidia offered customers preferential access to AI chips when they also purchased its networking equipment and Groq processors.
Nvidia has pledged to maintain access to SchedMD’s open-source software and says Hugging Face will continue supporting different chipmakers, cloud providers and AI companies. The inquiry does not establish wrongdoing, and the DOJ could conclude its investigation without taking legal action.
Why Hugging Face is more than another acquisition
Nvidia already supplies much of the computing hardware behind modern AI systems. Hugging Face would give it a stronger position in the software and developer community that builds those systems.
That combination deserves attention because developers often choose their tools, models and computing infrastructure together. If a platform becomes closely tied to one hardware provider, even without formally blocking competitors, its recommendations, integrations and deployment options could influence purchasing decisions.
For Nvidia, integrating its hardware and software could make AI development easier. For competing chipmakers, however, the concern is whether they could lose access to an important route to developers.
What this means for AI developers and businesses
Developers who use Hugging Face do not need to change their workflows based on the investigation alone. The immediate question is whether the platform will remain equally accessible to users working with Nvidia hardware and alternatives from companies such as AMD.
Businesses building AI applications should watch for changes to model access, hardware compatibility, cloud integrations, and pricing as the deal progresses. Maintaining the ability to move workloads between providers can help reduce dependence on a single vendor. For now, Nvidia has promised continued support for multiple providers, but the long-term implications will depend on how the acquisition proceeds and whether regulators seek conditions to protect competition.
The outcome could help determine whether AI development remains an ecosystem where competing hardware and software providers can coexist, or one increasingly shaped by companies that control several layers of the technology stack.
For channel partners, the proposed acquisition also raises questions about how AI infrastructure solutions will be packaged and sold. Resellers and systems integrators that support multiple hardware vendors may need to monitor whether Hugging Face’s integrations, deployment tools, and partnerships continue treating competing platforms equally.
Any shift toward Nvidia’s ecosystem could affect how partners design AI solutions and recommend infrastructure to customers.
In other news: Microsoft reported $10 billion in revenue from its commercial arrangements with OpenAI during its latest quarter, accounting for nearly 11% of its total revenue.