The US Department of Justice is asking hard questions about Nvidia's $12.93 billion deal to buy Hugging Face, the open-source AI platform where developers share and download AI models. Two people familiar with the matter told Reuters about the inquiries, which were reported on October 28, 2026.
The deal is expected to close in the first half of 2027, Nvidia has said, and Hugging Face would keep supporting work with a range of chip, cloud and AI providers. But regulators want to know whether the purchase would hand Nvidia control of a fundamental distribution point for AI — and whether that could harm rivals.
What the DOJ Is Asking
According to Reuters, the Justice Department's recent questioning covers Nvidia's acquisitions, investments and sales practices, and whether the chip designer has pressured its customers. On Hugging Face specifically, officials have asked whether the deal would let Nvidia capture a key distribution hub for AI models.
They are also asking how Nvidia might use the platform to harm rivals in the AI market, whether it could gain leverage from the newly acquired business, and questions about Hugging Face's competitors. A DOJ spokesperson declined to comment on specific matters, citing longstanding policy.
Nvidia declined to comment, and Hugging Face representatives did not immediately respond to a request for comment, Reuters reported.
Why Hugging Face Matters So Much
Hugging Face is not just another AI startup. It is the place where much of the open AI world lives — a hub where researchers and developers publish models, datasets and tools that others can build on. That is why regulators see it as a distribution point: whoever controls the hub could, in theory, shape which models developers find first and how easily they run on which hardware.
That concern is sharper because Nvidia already dominates AI chips. Its hardware powers ChatGPT, Anthropic's Claude and similar tools, and the company has become the most valuable company in the world during the AI boom. Our earlier look at how Nvidia nears $6 trillion shows just how central the chipmaker has become to the whole AI economy, while its recent deal to bring 45,000 GPUs to Kazakhstan shows how far its infrastructure reach now extends.
This Is Part of a Longer Investigation
The Hugging Face questions are not a one-off. Reuters reports the broader Nvidia examination began under former President Joe Biden and has continued under President Donald Trump, during which time Nvidia has remained the world's most valuable company.
As part of that probe, the DOJ has examined Nvidia's December 2025 purchase of SchedMD, whose open-source software helps run supercomputers, and its 2025 deal to license technology from chip startup Groq and hire its engineers. Officials have explored whether Nvidia offered larger chip allocations to customers who also bought its networking equipment and Groq processors, and whether it used a dominant product to push into a newer market.
The department has also looked at Nvidia's acquisition of Run:ai, which makes software that helps AI chips run more efficiently. There is no indication that President Trump is involved in the probe, Reuters said, and the investigation may not result in any Justice Department action. Government investigations are not evidence of wrongdoing and do not necessarily lead to lawsuits.
What Happens Next
For now, nothing is decided. Staff-led DOJ investigations often take years and can stretch from one administration to the next, and the department routinely seeks input from companies when evaluating proposed mergers. The Hugging Face deal itself is still months from its expected close.
Still, the questions matter for every developer who relies on open models. Hugging Face sits at the centre of the open-source AI ecosystem — the same ecosystem that recently gained four new open projects from Anthropic, OpenAI, Hugging Face and Alibaba. If regulators worry that a single chip giant could steer that hub, the outcome could shape how open AI stays open.
It also lands at a moment when the chip landscape is shifting fast. Even OpenAI is reportedly looking at buying Google's AI chips, a sign that no company wants to depend on a single supplier. The DOJ's questions about Nvidia are part of that bigger story: who controls the layers AI is built on, from chips to models to the platforms that distribute them?
For developers, the practical takeaway is simple: watch the deal's conditions, not just its price tag. A promise to keep supporting all chip and cloud providers would matter more than any headline number.
Would you trust one company to own both the chips and the hub where AI models live? Tell us in the comments!
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