The U.S. Department of Justice (DOJ) is reportedly scrutinizing Nvidia Corp. (NASDAQ:NVDA) over its planned $12.93 billion acquisition of Hugging Face.
The inquiry covers Nvidia’s acquisitions, investments, and sales practices, including whether the company pressured customers, Reuters reported. Officials are also examining whether the Hugging Face deal could give Nvidia control over a fundamental AI distribution point.
The department is also investigating whether Nvidia’s proposed acquisition of Hugging Face could give it an unfair advantage in the AI market by allowing it to disadvantage competing companies.
The DOJ has also reviewed Nvidia’s December 2025 acquisition of SchedMD, whose open-source software supports supercomputers used in areas relevant to national security, the report added.
Nvidia, Hugging Face and DOJ did not immediately respond to Benzinga’s request for comments.
Nvidia Deal Faces Regulatory Scrutiny
Nvidia’s proposed purchase of Hugging Face was announced in August as a major expansion into open-source AI models. The $12.9 billion transaction would rank among the company’s largest acquisitions, behind its reported $20 billion deal for Groq.
The company had said the acquisition is expected to close during the first half of 2027. Hugging Face would continue working with multiple chipmakers, cloud providers and AI companies after the transaction, according to the company.
In June, Sen. Elizabeth Warren (D-Mass.) invited CEO Jensen Huang to testify before the Senate Banking Committee about the company’s U.S. export-control position and business activities in China. Warren said China’s purchases of American goods benefit U.S. companies financially but undermine the country’s long-term national security.
Price Action: Year-to-date, Nvidia’s stock has surged 15.49%, as per Benzinga Pro. The shares dipped 0.70% to $213.88 premarket on Thursday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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