NVIDIA is seeking to further consolidate its control over the core assets of America's open-source AI sector.

According to a recent report, NVIDIA (NASDAQ: NVDA) is in negotiations with U.S. AI startup Reflection AI regarding an acquisition or deepened investment. Sources familiar with the matter revealed that discussions remain at an early stage, with a deal potentially materializing within the coming weeks, though there is also a risk of collapse. Reflection AI is regarded as the "American version of DeepSeek," with its latest valuation reaching $25 billion in a funding round earlier this March.

Should this transaction successfully come to fruition, it would mark yet another major move in NVIDIA's recent wave of large-scale AI investments. Just this September, NVIDIA acquired AI model repository Hugging Face for $13 billion; in December, NVIDIA also reached a licensing agreement worth approximately $20 billion with chip startup Groq. Citing sources familiar with the matter, Bloomberg reported that NVIDIA's negotiations with Reflection have not yet determined any terms, and possible deal structures include an "acqui-hire" (hiring employees and licensing technology), providing additional computing power, or further increasing equity stakes.

Flexible Deal Structures to Avoid Regulatory Scrutiny

According to reports, one of the transaction forms discussed in the negotiations is an "acqui-hire"—where NVIDIA would directly hire Reflection employees and obtain technology licenses rather than pursuing a full acquisition, thereby bypassing the lengthy antitrust review process.

This model has become increasingly popular in AI mergers and acquisitions among large technology companies. NVIDIA's approximately $20 billion deal with Groq previously adopted a similar structure, though that transaction has already faced a lawsuit from some Groq employees this week.

Beyond the "acqui-hire" option, NVIDIA may also choose to make additional equity investments in Reflection or deepen their partnership by providing more chips and computing power. NVIDIA is already one of Reflection's largest shareholders, having previously invested $800 million in the company.

Reflection AI: A Strategic Piece in America's "Open-Source Model" Game

Reflection AI was co-founded by two former Google DeepMind researchers, Misha Laskin and Ioannis Antonoglou, focusing on the development of open-weight models—which allow users to customize and run on their own hardware, with operating costs far lower than top-tier commercial models from OpenAI or Anthropic.

Earlier this month, Reflection released its first publicly customizable AI product Beam, which runs on NVIDIA chips. The company claims that Beam's performance on advanced reasoning benchmarks is comparable to domestic Zhipu AI's flagship open-source model GLM-5.2, while offering cost advantages in programming and AI agent tasks.

Reflection has also established partnerships with the U.S. Department of Defense and Department of Energy, and has signed AI model development agreements with U.S. allies including South Korea. Additionally, according to prior reports, Reflection has reached multi-billion-dollar computing power procurement agreements with Elon Musk's SpaceX and cloud service provider Nebius Group.

Reflection's investor lineup is equally noteworthy. Beyond NVIDIA, it includes Sequoia Capital, Disruptive, and 1789 Capital—Donald Trump Jr., son of President Trump, is a partner at 1789 Capital.

Jensen Huang Bets on Open-Source Ecosystem to Fill Frontier Model Gap

NVIDIA currently has its own open-weight model series Nemotron, but still has a clear gap in the field of frontier-scale foundational large models. Acquiring or deeply binding with Reflection would help NVIDIA directly fill this gap.

In July this year, NVIDIA CEO Jensen Huang publicly called for the establishment of a domestic American open-weight model "ecosystem," stating it is crucial for "creating opportunities for innovation and prosperity across the nation." The Trump administration's AI action plan also explicitly stated: "We need to ensure that America has leading open-source models based on American values."

From a broader perspective, NVIDIA has continued to make large-scale investments across various segments of the AI industry chain over the past two years—from major AI laboratories like OpenAI, to emerging cloud service providers like Nebius, and to a series of smaller AI companies. This strategy not only continuously generates demand for NVIDIA chips but also solidifies its core position in the entire AI economic system. A potential deal with Reflection would mark NVIDIA's transformation from a "shovel seller" to a model ecosystem builder "stepping onto the field personally."