DOJ Is Inquiring Into Nvidia's Hugging Face Purchase, Sources Say

What happened

The inquiries sit within a long-running investigation spanning administrations: Reuters, citing two people familiar with the matter, said the broad examination of Nvidia's conduct started under the Biden administration and has continued under the Trump administration; the Justice Department's recent questions also cover Nvidia's acquisitions, investments, sales practices and whether it has pressured customers; Reuters said the questions on the Hugging Face deal and details of the continued pursuit of Nvidia's conduct are reported for the first time.

On the Hugging Face deal itself, officials have asked whether Nvidia would capture a fundamental distribution point for AI, whether it could use the acquired business to gain leverage over rivals, and about Hugging Face's competitors; Reuters said government investigations are not evidence of wrongdoing and do not necessarily result in lawsuits, and the probe may not result in any Justice Department action; CNBC later confirmed the inquiry with an unnamed source.

The deal terms and Nvidia's earlier pledges are already public: Nvidia announced the agreement on Sept 3 at a total price of $12.93 billion, with about $11.9 billion payable to Hugging Face stockholders and an equity-based retention program of up to about $1 billion for employees, expected to close in the first half of 2027; Nvidia has said Hugging Face would continue to support a range of chip, cloud and AI providers, developers would choose the models, frameworks, clouds and inference providers they want, and Nvidia compute would not be required to build or deploy on Hugging Face.

Key facts

1. Deal value: $12.93 billion to acquire open-source platform Hugging Face, expected to close in the first half of 2027, subject to closing conditions including regulatory approvals.
2. Focus of the inquiries: whether Nvidia would capture a fundamental distribution point for AI, whether it could use the acquired business to gain leverage over rivals, and Hugging Face's competitors.
3. Long-running probe: the broad examination of Nvidia's conduct started under the Biden administration and has continued under the Trump administration; Reuters said there is no indication that Trump has any involvement.
4. Scope of questions: the Justice Department's recent questions cover Nvidia's acquisitions, investments, sales practices and whether it has pressured customers.
5. SchedMD: the DOJ has examined Nvidia's December 2025 acquisition of SchedMD, whose open-source software helps run supercomputers relevant to national security.
6. Groq: the DOJ has examined Nvidia's 2025 deal to license technology from chip startup Groq and hire its engineers, exploring whether Nvidia offered larger chip allocations if customers purchased its networking equipment and Groq processors.
7. Run:ai: the DOJ has also looked at Nvidia's acquisition of Run:ai, which makes software that helps AI chips run more efficiently.
8. Platform scale: Nvidia said more than 18 million developers and over 200,000 companies use Hugging Face, which hosts more than 3 million models and 500,000 datasets.
9. Responses: a DOJ spokesperson declined to comment on matters before the department; Nvidia declined to comment; Hugging Face did not respond to a request for comment.
10. Nature of the probe: government investigations are not evidence of wrongdoing and do not necessarily result in lawsuits, and the probe may not result in any Justice Department action, according to reports.