NVIDIA's Silent Invasion: Expanding Its Kingdom by Acquiring Rivals

NVIDIA's Silent Invasion: Expanding Its Kingdom by Acquiring Rivals

NVIDIA's Real Move Beyond Revenue Figures: A Strategy to Turn Rivals into "Friends"

While everyone focused on NVIDIA's record revenue of $96.2 billion in its second-quarter earnings report, the company's real strategic move is happening far beyond the financial statements. NVIDIA continues to expand its ecosystem by acquiring rivals or forming strategic partnerships.

1. Hugging Face: A $12.9 Billion Open Source Acquisition

NVIDIA is reportedly agreeing to acquire the open-source AI platform Hugging Face for $12.9 billion. This will be one of the company's largest acquisitions to date.

Strategic Significance:

Hugging Face is at the heart of the developers' ecosystem, housing approximately 3 million open models and 1 million datasets. While closed-source companies like NVIDIA, OpenAI, and Anthropic develop their own chips, NVIDIA aims to connect independent developers to its hardware by investing in the open-source ecosystem. The price tag (86 times the annualized revenue of approximately $150 million) suggests NVIDIA is making this acquisition for strategic control, not revenue.

Critical Point: Hugging Face currently supports AMD and Intel chips as well. Whether the platform can maintain its neutrality after the acquisition is the biggest question mark.

2. Rebellions: Secret Meetings with South Korea's Favorite

According to Bloomberg, NVIDIA CEO Jensen Huang has personally met with South Korean AI chip startup Rebellions. Possibilities include a technical partnership, investment, or a direct acquisition.

Who is Rebellions?

The company is valued at $2.3 billion and its investors include SK Hynix and Samsung Ventures. Developing AI inference-focused NPUs – this represents a large-volume market that will complement NVIDIA's strength in training. It also utilizes Samsung's 4nm manufacturing – potentially opening a second supply chain for NVIDIA besides TSMC.

Regulatory Risk: South Korea considers semiconductors a strategic asset; the US Department of Justice could also scrutinize NVIDIA's dominance from an antitrust perspective.

3. The Big Picture: The "Transform the Enemy" Strategy

In 2025, NVIDIA made a similar deal with Groq, absorbing its engineering team while leaving the company independent. It is now applying the same pattern with Rebellions and Hugging Face.

CEO Jensen Huang's secret formula: Instead of eliminating competitors, make them part of the ecosystem. This will:

• Send a message to regulators: "We are not monopolizing, we are cooperating"
• Expand the talent pool
• Reduce the need for customers to seek alternatives

Investor Note

The company announced a commitment to $18 billion in equity investments by fiscal year 2027. This shows that NVIDIA is taking determined steps towards becoming not just a chip vendor, but also the financier and architect of the entire AI ecosystem.

Risk to Watch: The integration of these acquisitions and the reaction of the open-source community will be the most critical points to watch in the coming period.

All assessments and comments here are purely personal and are absolutely not investment advice.

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