Hugging Face Crosses $100 Million in Annual Run Rate

Hugging Face has surpassed a $100 million annual revenue run rate, according to co-founder and CEO Clement Delangue, marking a new financial milestone for one of the largest open-source AI platforms.

Announcing the milestone in a post on X, Delangue said the company has prioritised building an open AI ecosystem over maximising short-term revenue. 

He said Hugging Face continues to ‘store and serve hundreds of petabytes of models and datasets’ while keeping the platform ‘free and open-source for 97% of our users.’

The company has built its business around hosting open AI models, datasets, evaluation tools, developer libraries and collaborative machine learning workflows. 

Delangue said that approach has helped Hugging Face establish ‘one of the most loved platforms in tech,’ with network effects, a defensible position and what he described as a sustainable AI business.

The CEO also pointed to growing enterprise interest in open and locally deployed AI systems, writing that he was excited ‘as more companies start to see the value of open and local AI.’

The financial milestone comes as Hugging Face continues to cement its position as the largest platform for open-source AI. 

In its State of Open Source report published in March, the company said its ecosystem had grown to 13 million users, hosting more than 2 million public AI models and 500,000 public datasets, with users increasingly contributing fine-tuned models, benchmarks and AI applications rather than simply consuming pretrained systems. 

The report also found that more than 30% of Fortune 500 companies now maintain verified accounts on the platform, reflecting growing enterprise adoption alongside its open-source community. 

The platform has also broadened its focus beyond software, expanding into open-source robotics following its acquisition of Pollen Robotics and the launch of new developer-focused hardware.

Over the years, Delangue has repeatedly stated that the company is profitable. As per Crunchbase, it has raised nearly $400 million in eight funding rounds, backed by Sequoia Capital, Google, and NVIDIA, among others. 

As of its last funding round in August 2023, Hugging Face is currently valued at $4.5 billion.

The company earns revenue through a freemium business model, offering paid subscriptions, enterprise software and AI infrastructure while keeping most of its platform free. 

Its main revenue streams include Hugging Face Pro subscriptions for individual developers, Team and Enterprise Hub plans that provide organisations with security, governance and collaboration features, as well as usage-based charges for AI inference, compute and dedicated deployment infrastructure.

The company also generates revenue through cloud infrastructure partnerships and enterprise AI services, with management saying its business is primarily driven by enterprise customers rather than its free community.