The U.S. Department of Justice is asking whether Nvidia’s $12.93 billion deal to buy Hugging Face would let it capture a fundamental distribution point for AI, Reuters reports — as part of a broader, years-long investigation into Nvidia’s acquisitions, investments, sales practices and alleged pressure on customers. Why it matters: Hugging Face is where much of the open AI world publishes and downloads models, so who owns it shapes competition well beyond chips.
October 29, 2026
What happened
According to two people familiar with the matter, DOJ officials have made recent inquiries focused on the Hugging Face acquisition, which Nvidia expects to close in the first half of 2027. Nvidia has said Hugging Face would continue to support work with a range of chip, cloud and AI providers. The department’s questions on this deal — and new details of its wider Nvidia probe — are being reported for the first time.
The details
Investigators are asking how Nvidia might use the platform to harm rivals or gain leverage in negotiations, and they are also asking about Hugging Face’s competitors. The wider examination, begun under the Biden administration and continued under President Trump, has also scrutinized Nvidia’s December 2025 acquisition of SchedMD, its acquisition of Run:ai, and its 2025 deal to license technology from chip startup Groq and hire its engineers — including whether Nvidia offered larger AI chip allocations to customers who bought its networking equipment and Groq processors.
Responses were muted. A DOJ spokesperson declined to comment on specific matters before the department. Nvidia declined to comment, and Hugging Face did not respond to a request for comment. Reuters notes that government investigations are not evidence of wrongdoing and do not necessarily result in lawsuits. Nvidia shares slipped in premarket trading Thursday as the inquiry became a market story.
Why it matters
Nvidia already dominates the hardware layer of AI. Hugging Face is a distribution layer — the shelf developers reach for first when they need an open model. Regulators appear to be testing whether owning both the shelf and the chips that run what’s on it crosses a line, even if the platform stays nominally open to rivals. For developers and AI companies, the practical takeaway is uncertainty: the deal’s closing timeline and any conditions attached to it are now open questions, and Nvidia’s buy-and-invest strategy across the AI stack is under a microscope that spans two administrations.
Frequently asked questions
What is the DOJ investigating about Nvidia and Hugging Face?
Whether the $12.93 billion acquisition would let Nvidia capture a key distribution point for AI models and use it to harm rivals or gain leverage.
When is the Nvidia–Hugging Face deal supposed to close?
Nvidia has said it expects the acquisition to close in the first half of 2027.
Does a DOJ inquiry mean Nvidia did something wrong?
No. As Reuters notes, government investigations are not evidence of wrongdoing and may not lead to any lawsuit or enforcement action.
Sources: Reuters, Barron’s