Nvidia ($NVDA) stock rose over 4% in Wednesday's trading following Bloomberg reports that the company is in advanced talks to acquire AI startup Hugging Face in a deal worth approximately $14 billion. The potential acquisition would significantly strengthen Nvidia's presence in AI software beyond its dominant position in chips and computing hardware. Hugging Face is a major platform where developers share and use AI models, hosting millions of models and datasets, making it a strategic asset for Nvidia's open-source AI push. As an existing investor in the company, Nvidia would gain more control over a platform used by a large developer base, supporting demand for its chips and systems as major AI firms build their own chips.
Nvidia insider selling has intensified with board member Mark Stevens filing to sell 5 million Class A shares worth approximately $1.09 billion. The Form 144 notice reached the US Securities and Exchange Commission (SEC) on September 2, naming Merrill Lynch as the broker and Nasdaq as the venue. Stevens holds the stock through the 3rd Millennium Trust and the 970 Foundation and has been trimming his position repeatedly throughout the year. Since June, Stevens has sold over $1.5 billion worth of shares, including 500,000 shares for $109.9 million on June 4, 885,000 shares raising $186 million two weeks later, and additional sales of 585,000 shares worth $128.9 million on August 31 and 63,501 shares worth $14 million on September 1. However, investors appeared to shrug off the insider selling activity, with Nvidia closing at $224.41 on Wednesday, up 3.21% from the previous session.
The $14 billion Hugging Face deal aligns with CEO Jensen Huang's push into open-source AI as major AI firms increasingly build their own chips. Nvidia has been actively expanding through AI deals, recently signing a multibillion-dollar licensing deal with Poolside and spending about $20 billion on Groq's technology and related assets. This acquisition would take Nvidia's software expansion further into AI software, supporting continued demand for its chips and systems. The deal also fits Huang's broader vision of AI's role in manufacturing revival, with the CEO stating that "AI is bringing manufacturing back to America and reindustrializing the nation after decades of offshoring."
Top US tech bosses, including Nvidia chief Jensen Huang and OpenAI's Sam Altman, urged G20 ministers Wednesday to embrace artificial intelligence and build the data centers to run it during the second day of a G20 meeting in North Carolina. Huang told ministers that "In the end, what every single country will have to recognize is that (AI) is infrastructure, just as it's water, roads, electricity, the internet." He emphasized that "Every single country needs to build infrastructure so that you can support your own local economy," with Nvidia's graphics processing units serving as key components for training AI models. However, data centers have become a political hot potato in the United States, with many communities opposed to their construction and concerned about the impact on electricity rates. The meeting was met with about 100 to 200 people protesting AI's fast development, reflecting public concern about the technology's rapid advancement.
Nvidia stock gained 4% following the acquisition news, with additional support from Dell Technologies' strong results showing $46.97 billion in revenue and raising its full-year revenue outlook to $192 billion. Robert W. Baird analyst Tristan Gerra maintained his bullish view on Nvidia, citing its AI computing lead, gains in inference and opportunities from agentic AI, while JPMorgan analyst Harlan Sur kept an Overweight rating with a $320 price target. On TipRanks, NVDA has a Strong Buy consensus rating based on 30 Buy ratings, with the average price target of $329.32 implying 45.18% upside potential from current levels. Year-to-date, NVDA shares have gained 16.7%, with the stock extending a 13.5% advance over the past month despite recent insider selling concerns.
