Sahih Bukhari Volume 006, Book 060, Hadith Number 126.
Narrated By Al-Aswad : While we were sitting in a circle in 'Abdullah's gathering, Hudhaifa came and stopped before us, and greeted us and then said, "People better than you became hypocrites." Al-Aswad said: I testify the uniqueness of Allah! Allah says: "Verily! The hypocrites will be in the lowest depths of the Fire." (4.145)
On that 'Abdullah smiled and Hudhaifa sat somewhere in the Mosque. 'Abdullah then got up and his companions (sitting around him) dispersed. Hudhaifa then threw a pebble at me (to attract my attention). I went to him and he said, "I was surprised at 'Abdullah's smile though he understood what I said. Verily, people better than you became hypocrite and then repented and Allah forgave them."