DOJ scrutinizing Nvidia's $12.93B Hugging Face acquisition over AI competition concerns (Oct 28)
What happened
Reuters reported Wednesday evening, citing two people familiar with the matter, that the U.S. Justice Department has made inquiries into whether Nvidia's $12.93 billion deal to buy open-source platform Hugging Face would harm competition in artificial intelligence. DOJ officials are asking whether the acquisition would let the chip giant 'capture a fundamental distribution point for AI' — leverage to disadvantage rivals or extract negotiating concessions — and have asked about Hugging Face's competitors. The questioning sits inside a broader, years-long DOJ investigation into Nvidia's conduct covering acquisitions, investments, sales practices, and customer pressure; the Hugging Face angle and details of the continued pursuit are reported here for the first time. Investigators are also reviewing Nvidia's December 2025 SchedMD and Run:ai acquisitions and the 2025 Groq licensing-and-talent arrangement, including whether chip allocations were steered to customers that bought networking gear tied to Groq. Nvidia declined to comment; a DOJ spokesperson declined to discuss pending matters, adding the department under President Trump will prioritize 'advancement of Super Intelligence.'
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Start your free 14-day trialWho’s affected
- Nvidia (NVDA): deal-block or deal-conditioning risk on a $12.93B flagship acquisition; regulatory overhang on its broader invest-and-acquire strategy. Semiconductor/AI dealmaking broadly: Hugging Face-related ecosystem names and AI M&A targets face a higher bar; rival chipmakers (AMD, Broadcom) are indirect beneficiaries of any constraint on Nvidia's distribution leverage.