| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 9.92% | -8.95% | -8.95% |
Baron Opportunity Fund declined 8.88% in Q1 2026, outperforming the Russell 3000 Growth Index but trailing the S&P 500 amid geopolitical tensions and AI-disruption fears. The quarter saw U.S.-Iran conflict disrupt energy supplies while software stocks sold off on concerns about AI replacing human workflows. Despite headwinds, the Fund's largest holding SpaceX contributed strongly alongside AI infrastructure beneficiaries like Taiwan Semi and Nova. Manager Lippert maintains conviction in secular growth trends, particularly AI where he sees compelling ROI evidence with Anthropic revenue surging from $9B to $30B annualized and OpenAI generating $2B monthly. The team used software weakness to upgrade portfolio quality, exiting Microsoft due to competitive positioning concerns while initiating positions in Alphabet, ASML, and Lam Research. Portfolio spans 46 companies with top 10 representing 64% of assets. Manager emphasizes the Fund's focus on transformative trends including AI, space exploration, autonomous transportation, and advanced therapeutics that will drive long-term returns despite short-term volatility.
Focus on powerful secular growth trends that disrupt industries and create sustained profitable growth opportunities, particularly AI infrastructure buildout, space technology advancement, and companies positioned to benefit from the AI transition.
Manager remains confident in strategy focused on durable growth based on powerful, long-term, innovation-driven secular growth trends. Believes noncyclical, durable, and resilient growth should be part of investors' portfolios and strategy will deliver solid long-term returns. Continues to run high-conviction portfolio with emphasis on transformative secular trends including AI, space technology, autonomous transportation, robotics, and advanced therapeutics.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| May 13 2026 | 2026 Q1 | AMZN, ANET, ASML, AVGO, COHR, CSGP, DDOG, GOOGL, IOT, LITE, LRCX, META, MSFT, NVDA, RBRK, SHOP, SPOT, TSLA, TSM | AI, Data centers, growth, infrastructure, semiconductors, software, Space, technology | - | Baron Opportunity Fund's Q1 decline reflected geopolitical tensions and AI-disruption fears, but manager sees compelling evidence of AI ROI inflection with frontier labs showing explosive revenue growth. Used software selloff to upgrade portfolio quality, maintaining conviction in secular growth trends. SpaceX largest holding, positioned across AI infrastructure from semiconductors to data centers for long-term transformation. |
| Feb 5 2026 | 2025 Q4 | ACLX, AMZN, ARGX, AXON, BRCM, CSGP, DUOL, EXAS, GOOGL, GTLB, HRTX, LLY, META, MSFT, NVDA, ONON, ORCL, SPOT, TSLA, TTD | AI, Cloud, growth, innovation, secular trends, semiconductors, Space, technology | - | Baron Opportunity Fund outperformed in Q4 2025 with 4.63% returns, led by SpaceX and AI investments. NVIDIA delivered 10x returns while Broadcom achieved 2.5x gains from explosive growth. The Fund maintains high conviction in secular trends including AI, space technology, and cloud computing, adding positions in public safety, athletic footwear, and medical diagnostics while exiting Oracle and Trade Desk. |
| Nov 8 2025 | 2025 Q3 | ANET, ARGX, AVGO, EXAS, GDS, GTLB, HRTX, IT, LLY, NVDA, PAR, SHOP, SMAR, SNPS, SPOT, TEAM, TSLA, TSM, TTD, VIA | AI, growth, infrastructure, innovation, large cap, semiconductors, technology |
NEE FFBC NVDA TSLA AVGO TTD IT PAR |
Baron Opportunity Fund underperformed in Q3 despite positive returns, hurt by stock selection and non-ownership of Apple/Alphabet. Core AI infrastructure thesis remains intact with NVIDIA, Tesla, and Broadcom driving performance. Manager maintains high conviction in secular growth trends including AI buildout, semiconductors, and digital transformation while staying disciplined on valuation and real versus speculative progress. |
| Aug 5 2025 | 2025 Q2 | AAPL, AMZN, ANET, ARGX, AVGO, DKNG, DUOL, EXAS, HUBS, LLY, META, MSFT, NET, NVDA, SPOT, TSLA, TSM, TTD, VRT, ZS | AI, Cloud, growth, innovation, large cap, semiconductors, technology | - | Baron Opportunity Fund gained 23.27% in Q2 2025, outperforming benchmarks through focused exposure to AI, semiconductors, and cloud computing. Strong stock selection in technology drove 90% of outperformance, led by NVIDIA, Broadcom, and Microsoft. AI adoption accelerated with massive infrastructure investments while Tesla launched Robotaxi service. Manager maintains conviction in transformative secular growth trends. |
| Mar 31 2025 | 2025 Q1 | AAPL, AMZN, ARGX, AVGO, CSGP, CYBR, LPLA, META, MPWR, MSFT, NARI, NVDA, NVMI, SNOW, SPOT, TEAM, TSLA, TTD, VRT, ZS | AI, growth, innovation, large cap, semiconductors, tariffs, technology, Trade Policy | - | Baron Opportunity Fund fell 11.97% in Q1 amid tariff uncertainty affecting AI leaders like NVIDIA and Tesla. Despite trade policy headwinds, the manager maintains conviction in secular growth trends, particularly AI as a transformative platform shift. The fund prioritizes companies with macroeconomic resilience while positioning for long-term technology-driven growth once current volatility subsides. |
| Dec 31 2024 | 2024 Q4 | AAPL, AMD, AMZN, ANET, ARGX, ASML, AVGO, CRWD, CYBR, GOOGL, INDI, LPLA, META, MPWR, MSFT, NARI, NVDA, PCVX, RCKT, SHOP, SPOT, TEAM, TSLA, TTD, VKTX, ZS | AI, growth, innovation, large cap, secular trends, technology |
TSLA NVDA ANET LPLA CYBR |
Baron Opportunity Fund gained 11.92% in Q4 and 40.25% for 2024, outperforming benchmarks through stock picking in innovation leaders. Key contributors included NVIDIA, Tesla, and SpaceX. The Fund maintains high conviction in secular technology trends including AI, electric vehicles, and cybersecurity while diversifying beyond the Magnificent Seven concentration that dominated market returns. |
| Sep 30 2024 | 2024 Q3 | AAPL, ACLX, AMD, AMZN, ARGX, AVGO, CRWD, DUOL, GDS, GWRE, INDIE, IT, MBLY, META, MSFT, NVDA, PAR, SPCE, TEAM, TSLA | AI, Data centers, growth, semiconductors, software, technology, Tesla | - | Baron Opportunity Fund outperformed in Q3 through AI infrastructure positioning, with Tesla and Meta leading gains. The fund maintains concentrated exposure to semiconductors and software, capitalizing on the AI arms race driving massive data center buildouts. Despite trimming NVIDIA and Microsoft, both remain top holdings alongside new positions in Broadcom and cloud beneficiaries. |
| Jun 30 2024 | 2024 Q2 | AAPL, AMD, AMZN, AVGO, CDNS, CRWD, CSGP, DAY, DDOG, EXAS, GWRE, IOT, META, MSFT, NVDA, RCKT, SPOT, TSLA, TSM, VKTX | AI, Cloud, growth, innovation, large cap, semiconductors, software, technology | - | Baron Opportunity Fund gained 4.43% in Q2, underperforming due to Apple underweight despite strong AI holdings performance. Manager views current period as AI infrastructure-build phase with hyperscalers investing $200 billion in capex. NVIDIA and Microsoft drove performance with explosive AI-driven growth. Fund maintains high conviction in secular AI, semiconductor, and cloud computing trends for multi-decade disruption opportunity. |
| Apr 15 2024 | 2024 Q1 | ACLX, AMD, AMZN, ASML, AVGO, CRWD, CSGP, INDI, LEGN, MBLY, META, MSFT, NVDA, RIVN, SPOT, SWAV, TSLA, TSM, TTD, VKTX | AI, Cloud, growth, innovation, large cap, semiconductors, technology | - | Baron Opportunity Fund gained 15.33% in Q1 2024, driven by AI and semiconductor investments led by NVIDIA and Microsoft. The manager positions the fund at the inflection point of generational AI adoption, expecting every digital interaction to become AI-powered. Despite trimming EV exposure due to near-term headwinds, secular growth conviction remains strong across technology-driven innovation themes. |
| Jan 27 2024 | 2023 Q4 | AMD, AMZN, ARGX, CDAY, CRWD, CSGP, DT, GOOGL, GTOS, GWRE, HUBS, ILMN, INDY, IT, LEGN, LRCX, META, MRVL, MSFT, NOW, NVDA, RIVN, SHOP, SWAV, TSLA, TTD, V, VKTX, WDAY | AI, Cloud, growth, innovation, semiconductors, software, technology |
AAPL|MSFT|NFLX|NVDA|UNH AMZN AAPL|MSFT|NFLX|NVDA|UNH LRCX |
Baron Opportunity Fund surged 50% in 2023, driven by concentrated bets on AI, cloud computing, and semiconductors. The manager views these as permanent technological shifts, not hype cycles, with companies like NVIDIA, Microsoft, and Amazon leading the transformation. Despite macro uncertainties, the fund maintains high conviction in innovation-driven secular growth trends that can deliver faster-for-longer growth. |
| Sep 30 2023 | 2023 Q3 | AMZN, ARGX, CRWD, CSGP, DDOG, DT, EA, GTLB, INDI, IT, LEGN, META, MSFT, NET, NOW, NVDA, RVAN, TKO, TSLA, V | AI, Biotechnology, Cloud, growth, innovation, large cap, secular trends, technology | - | Baron Opportunity Fund fell 5.03% in Q3 amid macro uncertainty but maintains high conviction in secular growth trends. Strong performance from Rivian and argenx offset Microsoft weakness. The fund continues investing in AI, cloud, electric vehicles, and biotechnology themes through companies with durable competitive advantages, emphasizing long-term value creation over short-term market volatility. |
| Dec 31 2022 | 2022 Q4 | AMD, AMZN, CRWD, INDI, IT, MA, MSFT, NVDA, RCKT, RIVN, TSLA, V, XFCH, ZI | - | - | |
| Sep 30 2022 | 2022 Q3 | ARGX, GOOG, INDI, ISRG, IT, MPWR, MSFT, NET, NOW, NVDA, RIVN, SHOP, TSLA, ZI | - | - | |
| Jun 30 2022 | 2022 Q2 | AMD, AMZN, ARGX, ASML, GOOG, MSFT, NET, NVDA, TSLA | - | - | |
| Mar 31 2022 | 2022 Q1 | ARWR, CDAY, CRWD, ILMN, MDB, MSFT, RIVN, SHOP, SWAV, TSLA, V | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
AIAI infrastructure buildout continues with hyperscalers guiding $650-700B capex in 2026. ROI inflection underway with Anthropic revenue surging from $9B to $30B annualized. Manager sees compelling evidence of sustained AI demand across training and inference workloads. |
Infrastructure Training Inference Hyperscalers ROI |
SemiconductorsMultiple AI scaling laws remain intact driving insatiable demand for advanced chips. NVIDIA maintains dominance while custom silicon accelerates. Manager positioned across NVIDIA, Broadcom, and equipment providers for multi-architecture evolution. |
NVIDIA Custom Silicon Equipment Foundries Memory | |
SpaceSpaceX is largest holding generating significant value through Starlink expansion and launch services. Space emerging as potential frontier for AI infrastructure with constant sunlight and vacuum physics advantages for large-scale compute. |
SpaceX Starlink Launch Infrastructure Compute | |
Data CentersHistoric infrastructure buildout driven by AI demand. Energy and cooling capacity emerging as binding constraints. Electrical distribution equipment remains key bottleneck with strong positioning in specialized providers. |
Infrastructure Energy Cooling Electrical Capacity | |
CloudHyperscalers collectively guiding massive capex increases with vast majority directed at AI data centers. Amazon's custom chip business reached $20B revenue run rate growing at triple-digit rates. |
Hyperscalers Capex Custom Chips Amazon Infrastructure | |
CybersecurityRansomware attacks growing in frequency and sophistication with adversaries leveraging AI. Zero-trust, immutable architecture purpose-built for threat environment driving market share gains from legacy vendors. |
Ransomware Zero-trust AI Threats Data Protection Recovery | |
| 2025 Q4 |
AIAI emergence has created market hysteria and broad software sell-offs despite limited real-world adoption. Manager believes incumbent software firms with domain expertise and proprietary data are better positioned than AI-native startups to capture long-term benefits from AI integration. |
Artificial Intelligence Software Automation Technology |
SoftwareSoftware sector treated as monolith awaiting AI disruption, but manager sees meaningful distinctions between companies. Dominant vertical software platforms that successfully integrate AI can thrive and fend off new entrants, particularly those with mission-critical systems and proprietary data. |
Enterprise Software SaaS Technology Vertical Software | |
ValueManager describes being caught between cutting-edge technologies and traditional value industries during a broadening market. Software holdings are ironically cheaper than traditional value industrial exposure, creating opportunity for value-oriented investors. |
Value Investing Valuation Contrarian | |
HotelsChoice Hotels represents asset-light, high-margin hotel franchisor trading at distressed multiples due to cyclical headwinds. Company shifting toward higher-revenue segments like Extended Stay and international markets, with potential for significant cash unlock and share buybacks. |
Hospitality Franchising Real Estate | |
| 2025 Q3 |
AIThe market has absorbed a surge of AI infrastructure buildouts with OpenAI announcing partnerships for tens of gigawatts of compute capacity. NVIDIA CEO Jensen Huang proclaimed global AI infrastructure spending could total $3 trillion to $5 trillion by 2030. The fund conducts intensive research to separate signal from noise in AI developments, examining parallels to past technology paradigm shifts while quantifying AI addressable markets across sectors. |
Infrastructure Compute Models Agents Commerce |
SemiconductorsNVIDIA has captured a dominant position in AI infrastructure with comprehensive portfolio spanning semiconductor accelerators, networking solutions, and software. The company reported 56% total and data center revenue growth with near-term visibility of tens of gigawatts in AI buildouts. Broadcom continues to demonstrate leadership in networking silicon from cloud era into AI era as the most reliable silicon partner for AI foundational model builders. |
Accelerators Networking Foundries Memory Equipment | |
CloudCloud infrastructure remains critical as AI infrastructure buildouts accelerate. OpenAI committed more than 5 gigawatts to Oracle for cloud infrastructure as part of the Stargate project. The fund sees cloud as foundational to AI deployment and continues to invest in companies positioned to benefit from this infrastructure expansion. |
Infrastructure Data Centers Computing Storage Services | |
Electric VehiclesTesla announced record third quarter results for both vehicle deliveries and energy storage deployment. The company's Austin robotaxi network expanded from 20 to over 170 square miles in two months after June 2025 launch. Tesla's AI initiatives continue advancing rapidly with FSD Version 14 anticipated to be critical step toward broader autonomous capabilities and humanoid robot expected to transition to volume production next year. |
Autonomous Batteries Charging Manufacturing Software | |
E-commerceThe global e-commerce market is estimated to hit $6.4 trillion this year, representing about 20.5% of global retail sales. The fund finds itself on the edge of the first holiday season where consumers will put AI commerce to the test with features like OpenAI's Instant Checkout. AI should influence and monetize a growing share of this massive consumer market over the remainder of the decade. |
Platforms Payments Logistics Marketplaces Software | |
AdvertisingThe global digital advertising market is projected to approach $850 billion this year and should continue to see share shifts as AI reshapes consumer engagement. The Trade Desk remains the product leader in the DSP space despite competitive pressures from Amazon's competing platform. The company is well positioned to benefit from strengthening brand advertising trends. |
Digital Programmatic Platforms Targeting Analytics | |
| 2025 Q2 |
AIAI adoption and revenue growth accelerating with ChatGPT reaching 800 million weekly active users by April 2025. Multiple AI scaling laws remain intact including pre-training, post-training, and test-time compute. Companies investing massive amounts in AI infrastructure with NVIDIA CEO stating no technology has ever had opportunity to address larger part of world's GDP than AI. |
Artificial Intelligence Machine Learning Large Language Models AI Infrastructure Compute |
SemiconductorsNVIDIA maintaining leadership in AI infrastructure with comprehensive portfolio spanning accelerators, networking, and software. Blackwell chip achieving fastest ramp in company history with $11 billion revenue. AI cluster buildouts extending into 2026 with multiple scaling laws driving continued growth in compute requirements. |
GPUs AI Chips Data Center Compute Infrastructure Networking | |
CloudMicrosoft Azure accelerating 400 basis points to 35% constant-currency growth, well ahead of expectations. Management expects to be AI constrained past June as planned demand growing faster than supply. Cloud infrastructure critical for AI training and inference workloads. |
Cloud Computing Azure Infrastructure SaaS Hyperscale | |
GLP1GLP-1 drugs representing transformative opportunity with estimated 32 million type 2 diabetics and 105 million obese patients qualifying in US alone. Lilly leading with most effective approved drugs and strong pipeline including once-daily oral orforglipron. Market expected to become at least $150 billion category. |
Diabetes Obesity Weight Loss Pharmaceuticals Therapeutics | |
Electric VehiclesTesla launching Robotaxi service in Austin marking significant step toward fully autonomous ride-hailing network. Fleet scaled to 7.5 million vehicles with over 3.5 billion cumulative miles of Full Self Driving data. Company completed first fully autonomous vehicle delivery from factory to customer. |
Autonomous Driving Robotaxi Self-Driving Transportation Mobility | |
StreamingSpotify demonstrating durability in unpredictable macro environment with continued path to structurally increase gross margins. High-margin artist promotions marketplace, profitable podcasts, and higher-margin audiobooks driving improvement. Paid users growing at double-digit pace despite price hikes. |
Music Streaming Digital Media Subscription Audio Entertainment | |
| 2025 Q1 |
AIAI remains the most powerful technology platform shift and secular growth driver since the internet. Despite tariff uncertainty affecting valuations of AI leaders like NVIDIA and Broadcom, robust AI capital investment plans continue through 2025-2026. The manager believes AI will drive productivity-driven digital transformation, with tech spending potentially doubling from 5% to 10% of global GDP. |
Artificial Intelligence GPUs Data Centers Machine Learning Semiconductors |
Trade PolicyTariffs and trade restrictions have dominated market narrative, creating volatility reminiscent of historic market upheavals. The Trump administration's reciprocal tariffs and subsequent 90-day pause have kept uncertainty elevated. The manager is rigorously assessing portfolio company resilience against tariffs and trade barriers while prioritizing companies with macroeconomic resilience. |
Tariffs Trade War China Export Controls Geopolitical | |
SemiconductorsSemiconductor companies face headwinds from trade restrictions, particularly NVIDIA's H20 chip ban to China. However, the manager remains confident in long-term AI semiconductor demand, with TSMC reporting robust AI-related demand and revenue from AI accelerators expected to double in 2025. Custom AI accelerator development continues with multiple partners. |
Chips Foundries AI Accelerators Manufacturing Export Controls | |
CloudCloud computing remains a core secular megatrend driving portfolio positioning. Companies like Snowflake are capitalizing on the data intelligence market within an AI-centric ecosystem, with accelerated product innovation enabling better AI use case addressing. The cloud infrastructure supports the broader AI transformation across enterprises. |
Data Analytics SaaS Infrastructure Enterprise Software Digital Transformation | |
Electric VehiclesTesla faces near-term headwinds from Model Y refresh timing and regulatory changes, but the manager remains confident in long-term growth driven by EV adoption trends. Tesla's AI ambitions including robotaxi service and Optimus humanoid program hold promise for transforming the growth story, with Elon Musk predicting Optimus will become the overwhelming value of the company. |
EVs Autonomous Driving Robotics Energy Storage Manufacturing | |
AdvertisingDigital advertising platforms like The Trade Desk face near-term macro headwinds but maintain structural advantages in programmatic advertising. The shift from linear TV to streaming creates secular tailwinds in connected TV advertising, with Trade Desk positioned to benefit from partnerships with Netflix, Spotify, and Pinterest opening inventory to programmatic buying. |
Programmatic Connected TV Digital Marketing Ad Tech Streaming | |
| 2024 Q4 |
AIAI infrastructure demand continues to drive robust performance across compute, networking, and systems. NVIDIA maintains unmatched leadership spanning GPUs, systems, software and networking solutions. The advent of reasoning models requiring multiple passes through models is expected to significantly increase compute intensity in both training and inference. |
Compute Infrastructure Training Inference GPUs |
Electric VehiclesTesla remains the innovation leader in real-world, physical AI with growing investor confidence in promising AI initiatives, stabilizing financials, and highly anticipated new vehicle models. The company is channeling funds into AI developments including autonomous-driving technologies and humanoid robots. |
Autonomous Robotics Innovation Physical AI | |
CloudMicrosoft continues building its $150 billion run-rate cloud business including Azure cloud infrastructure service. Azure growth is expected to reaccelerate in the second half of fiscal year as supply constraints ease, with AI application business benefiting from Microsoft 365 adoption. |
Infrastructure SaaS Azure Supply | |
CybersecurityIncreasing frequency and severity of ransomware attacks, heightening geopolitical tension, and stricter regulatory disclosure requirements have made privileged access management a higher priority IT spend category. CyberArk leads the PAM sector with over 25% market share. |
Ransomware Privileged Access Identity Regulatory | |
SemiconductorsAI infrastructure buildout is significantly more network-intensive than conventional data centers, creating massive opportunities for networking solutions. The shift toward Ethernet-based networking from InfiniBand creates new competitive dynamics in the semiconductor space. |
Networking Ethernet Infrastructure Compute | |
Capital MarketsLPL Financial benefits from secular growth in demand for financial advice and a shift among financial advisors away from large banks toward independent models. As the largest independent broker-dealer, LPL is well positioned to continue taking market share. |
Independent Advisors Broker-dealer Technology | |
BiotechnologyViking Therapeutics has a best-in-class GLP-1/GIP in development for obesity treatment with strong oral data disclosed. The VTE treatment space with Inari Medical is in early days of converting to device-based interventions, attacking a large unpenetrated addressable opportunity. |
GLP-1 Obesity Medical Devices Gene Therapy | |
SpaceSpaceX is generating significant value with rapid expansion of Starlink broadband service, deploying vast constellation of satellites and regularly deploying new efficient hardware technology. The company has established itself as a leading launch provider with highly reliable and cost-effective launches. |
Satellites Broadband Launch Starlink | |
| 2024 Q3 |
AIThe fund views AI as an arms race to develop foundational models and achieve artificial general intelligence. Scaling laws drive massive infrastructure investments, with hyperscalers building data centers at unprecedented scale. New inference architectures like OpenAI's chain of thought models require exponentially more compute power. |
Infrastructure Compute Models Inference Scaling |
SemiconductorsAI infrastructure demand is driving unprecedented semiconductor requirements, with hyperscalers planning data centers with 100,000 AI accelerator chips each. The fund sees both general-purpose GPU demand and custom accelerator chip opportunities as key growth drivers. |
GPUs Accelerators Custom Foundries Equipment | |
Data CentersMassive data center buildouts are underway to support AI workloads, with companies like Tesla expanding compute capacity six-fold in one year. The fund sees sustained pricing power due to power constraints and strong demand from cloud adoption and AI applications. |
Power Capacity Infrastructure Hyperscale Colocation | |
CloudCloud migration continues as a secular trend, particularly in Asia where adoption lags the US. The fund sees cloud as the foundation for AI applications and expects continued growth in cloud infrastructure and software-as-a-service offerings. |
Migration SaaS Infrastructure Platform Services | |
Electric VehiclesTesla is positioned as both an EV manufacturer and AI leader, leveraging its fleet data for autonomous driving development. The fund sees Tesla's unique dataset from billions of miles driven and massive compute investments as competitive advantages in the autonomous vehicle market. |
Autonomous Fleet Data FSD Robotaxi | |
RoboticsTesla's Optimus humanoid robot represents a potential market opportunity larger than automotive and robotaxi combined. The company is leveraging automotive technologies like actuators, batteries, and production capabilities to enter the robotics market. |
Humanoid Automation Manufacturing Optimus Industrial | |
| 2024 Q2 |
AIManager believes AI is the most significant technological platform shift since the internet, driving explosive growth in infrastructure investments. Currently in the AI infrastructure-build phase with hyperscalers investing $200 billion in capex. Early AI applications showing measurable ROI with 30-60% developer productivity improvements and 15-30% customer service cost savings. |
Machine Learning GPUs Data Centers Cloud Computing Automation |
SemiconductorsNVIDIA leading unprecedented growth with quarterly revenues of $26 billion up 262% year-over-year. New Blackwell architecture provides 4x faster training and 30x faster inference. Semiconductor performance has seen widest discrepancy versus software in 20 years, with accelerated computing improving 1,000x over eight years. |
GPUs Chip Design Foundries Memory Processing Power | |
CloudHyperscalers building AI factories with massive infrastructure investments. Microsoft Azure accelerating to 31% growth with Azure OpenAI used by 65% of Fortune 100. Cloud infrastructure essential for AI deployment with companies needing to invest now or risk being disrupted. |
Infrastructure SaaS Data Centers Scalability Computing | |
Enterprise SoftwareSoftware experiencing longer sales cycles as customers become more strategic in vendor selection for AI initiatives. Winners will have differentiated data, distribution advantages, and ability to deliver AI services better than build-your-own tools. Some applications already showing productivity gains while others still in proof-of-concept stage. |
SaaS Productivity Automation Integration Workflows | |
| 2024 Q1 |
AIAI is described as the most significant advancement impacting the digital world since the internet itself. The fund is positioned just past the first upward inflection in a generational S-curve for AI adoption and economic impact. Every digital interaction will eventually be AI powered, making humans more productive across various activities. |
Artificial Intelligence Machine Learning Generative AI AI Platform AI Software |
SemiconductorsSemiconductors power every digital or electronic device and are central to the AI revolution. The fund holds leading semiconductor companies including NVIDIA, which disclosed 40% of its data center business was from AI inferencing. New chip architectures and manufacturing advances continue to drive performance improvements. |
Chips Foundries GPU Data Center Computing | |
CloudCloud computing remains a real and intact secular trend. Microsoft has built a $135 billion run-rate cloud business including Azure infrastructure and Office 365 applications. The shift of workloads to the cloud continues with Microsoft expected to gain incremental IT budget share. |
Cloud Infrastructure SaaS Azure Cloud Computing Digital Transformation | |
Electric VehiclesThe fund maintains long-term conviction in the interconnected triangle of disruptions impacting global transportation: electric battery propulsion, autonomous driving, and shared mobility. However, current EV adoption has paused due to product launch gaps and the fund reduced exposure due to weak near-term trends. |
EV Battery Autonomous Driving Transportation Tesla | |
BiotechnologyThe pharmaceutical industry is shifting back to lower-priced, higher-volume primary care medications led by obesity treatments. Viking Therapeutics has potential in the exceptionally large obesity market with its GLP-1/GIP combination weight loss medication that appears more efficacious than competitors. |
GLP1 Obesity Pharmaceuticals Clinical Trials Drug Development | |
CybersecurityCybersecurity investments are capitalizing on the AI inflection, with companies like CrowdStrike Holdings among the contributors to fund performance during the quarter. |
Security Data Protection Enterprise Security Threat Detection AI Security | |
| 2023 Q4 |
AIAI is described as real and transformative, not hype, with the fund positioned across the AI stack from semiconductors to cloud services to applications. The manager emphasizes they have been investing in AI for years, predicting it will forever change human-computer interaction through natural language processing. |
Artificial Intelligence Machine Learning Natural Language Generative AI Computer Vision |
CloudCloud computing adoption is accelerating with CIOs reporting significant increases in public cloud workloads. Microsoft Azure and Amazon AWS remain the clear leaders, with the fund positioned to benefit from the ongoing shift of enterprise workloads to the cloud infrastructure. |
Cloud Infrastructure Public Cloud SaaS Azure AWS | |
SemiconductorsThe semiconductor industry is experiencing unprecedented demand driven by AI workloads and data center transformation. NVIDIA is seeing extraordinary growth with data center revenues expected to triple, while the fund also invests in semiconductor equipment companies positioned for technology transitions. |
Chips Data Centers GPU Memory Foundries | |
Electric VehiclesElectric vehicles represent a real and growing trend with the fund maintaining exposure through Tesla and adding positions in companies like Rivian. The manager views EVs as part of the broader autonomous driving and transportation transformation. |
EVs Autonomous Driving Battery Technology Transportation Clean Energy | |
CybersecurityCybersecurity remains a defensive IT priority for CIOs with strong demand for security software solutions. The fund maintains positions in leading cybersecurity companies while trimming some positions after strong performance in 2023. |
Security Software Threat Detection Identity Management Data Protection Compliance | |
BiotechnologyThe fund is investing in innovative biotechnology companies including those developing oral GLP-1 drugs for diabetes and obesity treatment. Structure Therapeutics represents a potential leader in oral options that could expand access to these large addressable markets. |
Drug Development Clinical Trials Diabetes Treatment Obesity Therapeutics | |
| 2023 Q3 |
AIThe fund emphasizes artificial intelligence as a generational shift driving demand for data center chips and accelerated computing. NVIDIA is positioned at the epicenter of this new computing era, with the transition from general purpose to accelerated computing creating tremendous demand across industries. The fund views AI as part of a broader technology stack from semiconductors to applications. |
Accelerated Computing Data Centers Generative AI Computing Platform Machine Learning |
CloudCloud computing represents a core secular trend with Microsoft building a $60+ billion cloud business including Azure infrastructure and Office 365. The fund sees continued growth as customers expand digital applications and cloud footprints, with companies consolidating spending onto platforms like Dynatrace for IT monitoring and application performance. |
Azure SaaS Digital Transformation Infrastructure Platform Consolidation | |
Electric VehiclesThe fund maintains conviction in electric vehicle adoption through Rivian, which is hitting execution milestones in production ramping and cost reduction. Management expects improving unit economics as production scales and new technologies like Enduro motors and LFP batteries reduce costs. The upcoming R2 model represents a key catalyst for broader market penetration. |
Production Scaling Battery Technology Cost Reduction Vehicle Manufacturing EV Adoption | |
BiotechnologyThe fund focuses on differentiated antibody-based therapies and cellular treatments for autoimmune diseases and cancer. Argenx's Vyvgart launch for myasthenia gravis has tripled consensus expectations, while Legend Biotech's Carvykti offers potential curative treatment for multiple myeloma with significant revenue opportunity reaching $10-20 billion. |
Autoimmune Diseases Cellular Therapy Oncology Antibody Therapies Rare Diseases | |
CybersecurityCybersecurity remains a critical secular trend with companies like CrowdStrike and Dynatrace providing essential protection and monitoring capabilities. The fund sees continued demand as enterprises expand their digital footprints and require comprehensive visibility into IT systems to predict issues and reduce downtime. |
IT Security Application Monitoring Threat Detection Enterprise Protection Digital Infrastructure |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | TTD | The Trade Desk, Inc. | Communication Services | Programmatic advertising platforms | Bull | NASDAQ | Competitive Advantage, Connected tv, digital advertising, Free Cash Flow, Identity, operating leverage, Programmatic | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | NEE | NextEra Energy, Inc. | Utilities | Electric Utilities | Bull | NYSE | Demographics, dividends, ratebase, Regulation, renewables, Solar, utilities, Wind | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | IT | Gartner, Inc. | Information Technology | Technology research & advisory | Bull | NYSE | competitive moat, Free Cash Flow, generative AI, Pricing power, recurring revenue, research, subscription revenue | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | FFBC | First Financial Bancorp. | Financials | Regional Banks | Bull | NASDAQ | Banks, Credit, M&A, profitability, Regionals, Roa, Rotce, valuation | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | NVDA | NVIDIA Corporation | Information Technology | Graphics & AI processors | Bull | NASDAQ | Artificial Intelligence, competitive moat, data centers, Free Cash Flow, GPUs, hyperscalers, semiconductors, valuation | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | PAR | PAR Technology Corporation | Information Technology | Restaurant POS software | Bull | NYSE | ARR growth, Free Cash Flow, operating leverage, Point of Sale, recurring revenue, Restaurant technology, Vertical SaaS | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | TSLA | Tesla, Inc. | Consumer Discretionary | Electric vehicles & energy storage | Bull | NASDAQ | Autonomy, Electric Vehicles, energy storage, growth, Margins, Software, valuation, vertical integration | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | AVGO | Broadcom Inc. | Information Technology | Data center & networking semiconductors | Bull | NASDAQ | AI infrastructure, ASICs, buybacks, capital allocation, data centers, dividends, Free Cash Flow, semiconductors | Login |
| Dec 31, 2024 | Fund Letters | Baron Opportunity Fund | CYBR | CyberArk Software Ltd. | Information Technology | Systems Software | Bull | NASDAQ | cybersecurity, Identity Security, margin expansion, market leader, Privileged Access Management, Ransomware Protection, Software | Login |
| Dec 31, 2024 | Fund Letters | Baron Opportunity Fund | TSLA | Tesla, Inc. | Consumer Discretionary | Automobile Manufacturers | Bull | NASDAQ | AI, autonomous driving, Electric Vehicles, energy storage, growth, innovation, robotics, Software | Login |
| Dec 31, 2024 | Fund Letters | Baron Opportunity Fund | NVDA | NVIDIA Corporation | Information Technology | Semiconductors | Bull | NASDAQ | AI, data center, GPUs, growth, Networking, semiconductors, Software, Systems | Login |
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| Dec 31, 2023 | Fund Letters | Baron Opportunity Fund | AAPL|MSFT|NFLX|NVDA|UNH | Microsoft Corporation | Software & Services | Systems Software | Bull | NASDAQ | AI, Azure, Cloud computing, growth, SaaS, Software, technology | Login |
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| Dec 31, 2023 | Fund Letters | Baron Opportunity Fund | LRCX | Lam Research Corporation | Information Technology | Semiconductor Equipment | Bull | NASDAQ | Deposition, DRAM, Etch, Nand, semiconductor equipment, technology, WFE | Login |
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| TICKER | COMMENTARY |
|---|---|
| NVDA | NVIDIA Corporation remains the dominant platform for AI training and inference. At GTC, the company unveiled a more diversified product roadmap — including Vera CPU-only servers for agentic workloads and an expanded inference strategy — reflecting the organizational agility we look for in management teams. We continue to view NVIDIA as the leading merchant platform for bringing AI to the world, with a long runway driven by enterprise adoption and Physical AI. Shares of NVIDIA Corporation, a semiconductor and systems company specializing in compute and networking platforms for accelerated computing, detracted from performance during the quarter as concerns over the sustainability of AI infrastructure capital expenditure intensified, with many market participants coming to view 2027 as a peak spending year, and as NVIDIA's largest customers continue pursuing custom silicon architectures, raising questions about the company's longer-term revenue trajectory. We retain conviction in the position. Demand for AI infrastructure remains insatiable, driven by continued returns to scaling training workloads and a meaningful inflection in inference demand, and the remarkable acceleration in revenues at frontier AI labs — accompanied by improving unit economics — validates the sustainability of long-term infrastructure investment. While some hyperscalers and AI labs are pursuing in-house silicon programs, these efforts remain in early stages and require substantial investment in both design and software, with Google's TPUs and Amazon's Trainium being the notable exceptions. We expect NVIDIA to continue performing well with its largest customers while expanding its footprint across sovereign deployments, on-premise enterprise installations, and cloud infrastructure buildouts globally. At current prices, the stock is attractively valued on next year's estimated financial results, and we believe AI compute demand is a durable, multi-year phenomenon — not the peak cycle the market fears. We continue to maintain NVIDIA as a top holding. |
| AMZN | On the Amazon.com, Inc. side, CEO Andy Jassy disclosed that its custom chip business — spanning Trainium, Graviton, and Nitro — has reached a $20 billion annual revenue run rate, growing at triple-digit rates. We are positioned to benefit from this multi-architecture evolution through our ownership of NVIDIA, Broadcom, Alphabet, and Amazon. |
| TSLA | Shares of Tesla, Inc., which designs, manufactures, and sells fully electric vehicles, solar products, and energy storage solutions while developing real-world AI technologies and applications, detracted from performance this quarter as the stock consolidated following robust gains in late 2025, with investors awaiting robotaxi progress and digesting Tesla's sizable investments in manufacturing and AI. Operationally, results were strong despite a challenging electric vehicle market: automotive gross margins rose materially in the fourth quarter of 2025, beating expectations and reaching their highest level in two and a half years, while energy storage margins approached 30%. Tesla continues to advance its AI and autonomy initiatives at full speed — the company anticipates meaningful robotaxi expansion in 2026, released a newer version of its autonomous driving software, and commenced production of its Cybercab, its first purpose-built autonomous transportation platform. Nevertheless, investors continue to scrutinize the pace of robotaxi deployment against Waymo's ongoing scaling, and Tesla's decision to more than double its annual capital expenditures — including its ambitious Terafab domestic chip manufacturing initiative — has heightened near-term perceived risk. We believe these strategic investments can materially strengthen Tesla's competitive position in the AI-first world, and we remain confident in the company's long-term growth across electric vehicles, energy storage, and autonomous driving. Looking further ahead, Tesla's Optimus humanoid robot program may prove to be its most transformative initiative of all — Elon Musk has called it potentially the most valuable product in human history, and we believe the program's progress warrants serious attention from long-term investors. |
| SPOT | Other relative performance laggards included companies impacted by the AI-disruption trade, such as software vendors Atlassian Corporation, Zscaler, Inc., Snowflake Inc., and Shopify Inc.; global streaming music and content leader, Spotify Technology S.A.; and syndicated research and advisory firm, Gartner, Inc. |
| META | Amazon, Alphabet, Microsoft, and Meta have collectively guided to approximately $650–$700 billion of capital expenditures in 2026, roughly triple the level from just two years ago, with the vast majority directed at AI data centers, chips, and networking. |
| GOOGL | During the first quarter, we initiated a position in Alphabet Inc., the parent company of Google and one of the world's most valuable technology franchises. After missing Alphabet's strong run in the latter part of 2025, we took a fresh look at the competitive landscape across hyperscalers and frontier AI labs and concluded that Alphabet offers the most compelling combination of assets in AI at an attractive valuation. We believe that combination includes unmatched consumer distribution across Search, YouTube, Chrome, and Android — including seven products with over two billion users each — proprietary Gemini frontier models, custom tensor processing unit chips, owned data center infrastructure, and decades of unrivaled user and advertiser data. This fully integrated and cost-advantaged AI stack is funded by one of the most cash-generative business models in the world. Despite the rise of AI-native competitors, Search and YouTube continue to grow at double-digit rates at enormous scale and have not missed advertising revenue expectations once since the launch of ChatGPT in November 2022. Meanwhile, Google Cloud is accelerating (we are projecting over 60% year-over-year revenue growth for this segment), driven by demand from leading frontier AI labs and a growing base of AI-forward enterprise customers. We are also encouraged by management's observation that AI features are deepening user engagement rather than disrupting it, with more complex and multimodal queries driving more time on platform. Alphabet is one of a very small number of companies in the world with the distribution, capital, proprietary data, and technical infrastructure to compete and win across multiple layers of the AI ecosystem simultaneously — and at a reasonable valuation, we see a compelling long-term opportunity for shareholders. |
| TSM | In the Information Technology and Industrials sectors, our investments in companies benefiting from AI-infrastructure investments contributed to absolute and relative performance, including Taiwan Semiconductor Manufacturing Company Limited (the world's advanced-semiconductor manufacturing champion), Nova Ltd. (leading provider of advanced metrology solutions for semiconductor manufacturing), GDS Holdings Limited (leading China data center operator), Monolithic Power Systems, Inc. (high-performance power management semiconductor leader), Lumentum Holdings Inc. (optical technology leader), and Quanta Services, Inc. (electric grid and energy infrastructure buildout leader). |
| AVGO | The shift toward custom silicon is also accelerating. Broadcom Inc. confirmed an expanded agreement with Alphabet for next-generation Tensor Processing Units (TPUs) and a deal to supply approximately 3.5 gigawatts of compute capacity to Anthropic. Broadcom is the only partner capable of matching the annual development cadence hyperscalers and AI labs require at scale. |
| MSFT | Shares of Microsoft Corporation, the world's largest software and cloud computing company, detracted from performance before we exited the position during the quarter. Our decision to sell was driven by a combination of near-term execution shortfalls and longer-term structural concerns about the company's competitive positioning in AI. On the near-term side, Azure revenue growth came in below expectations, as capacity constraints, including the allocation of capacity to first-party applications, continued to hamper results. More importantly, our view on Microsoft's longer-term positioning has shifted. The company remains heavily dependent on OpenAI for its core AI models, representing meaningful vendor concentration risk, while its own internal AI development efforts have been underwhelming. Microsoft has also struggled to gain traction with its first-party AI applications, with adoption of its Microsoft 365 Copilot product remaining limited relative to its enormous installed base of commercial users. We believe nimbler competitors are pulling ahead rapidly at the enterprise AI application layer — and in an era where the pace of innovation is paramount, we do not believe that being a fast follower with adequate but not leading products is a viable long-term strategy. As the new agentic technology stack is built out, Microsoft's historical competitive moat — built on distribution, bundling, and deep enterprise entrenchment — appears less durable than it was during prior platform shifts. For these reasons, we exited the position during the quarter, though we will continue to monitor the company's progress closely and remain open to revisiting our investment view should the competitive dynamics shift in Microsoft's favor. |
| CSGP | The Fund's investment in CoStar Group, Inc. (commercial real estate data, analytics, and marketing services provider) was the largest drag on relative performance. |
| ASML | During the first quarter, we initiated a position in ASML Holding N.V., a Dutch semiconductor equipment company and the world's sole provider of extreme ultraviolet lithography (EUV) systems — the indispensable technology required to manufacture the most advanced chips at the smallest geometries. Without ASML's machines, chipmakers cannot achieve the transistor densities needed to power artificial intelligence accelerators, flagship smartphones, autonomous vehicles, and other high-performance computing applications. This is not a temporary competitive advantage — the extraordinary complexity of EUV lithography and its sprawling global supply chain make it virtually impossible for any competitor to replicate, and we expect ASML's monopoly position to endure for the foreseeable future. As we noted earlier in this letter, we exited our position in Nova Ltd. and redeployed the proceeds into ASML, where we see a more compelling long-term opportunity across several dimensions. As leading chipmakers race to expand advanced manufacturing capacity to meet surging AI demand, we expect ASML to benefit from rising EUV layer counts across advanced logic and memory, as well as the eventual ramp of its next-generation High-NA EUV, which offers superior resolution and enables continued transistor scaling. We are also entering a period of significant memory capacity expansion, driven by insatiable demand for high-bandwidth memory (HBM) in AI applications, and ASML is more directly levered to this buildout than Nova. Finally, ASML's pricing power and increasing scale support significant gross margin expansion and strong double-digit earnings growth — and we believe it stands as one of the most competitively protected businesses in global technology. |
| LRCX | During the first quarter, we also initiated a position in Lam Research Corporation, a leading provider of wafer fabrication equipment specializing in deposition and etch — two of the most critical and layer-intensive steps in chip manufacturing. We believe the semiconductor equipment industry is at an important inflection point, and that Lam is exceptionally well positioned to benefit. As CEO Tim Archer noted on the fiscal first quarter 2026 earnings call, 'the surge in AI data center demand is creating billions of dollars of served available market expansion and share gain opportunity for Lam in the coming years.' To understand why, it helps to know that as chips become more complex, manufacturers must stack more layers of materials on top of one another — and each additional layer requires precisely depositing new materials and etching away unwanted ones. The proliferation of AI workloads, shrinking chip geometries, and the verticalization of chip designs are all driving a significant increase in layer counts, directly expanding demand for Lam's core capabilities. Lam is competitively advantaged by decades of proprietary expertise in plasma etch and deposition, deep integration into its customers' fabrication processes — which creates high switching costs — and a global installed base of over 100,000 chambers that generates recurring, annuity-like revenue, earning more over the life of a tool than from the initial sale itself. This advantage is perhaps most visible in HBM, where Lam holds virtually 100% market share for the highly complex precision etching required. We also believe the market is underestimating Lam's earnings power as NAND memory (flash memory or non-volatile storage) capital expenditure spending recovers from one of its most severe downturns on record — having fallen approximately 50% from its 2022 peak — creating meaningful pent-up demand that we expect to benefit Lam significantly in the coming years. |
| ANET | In networking and optical interconnects, all component suppliers are supply constrained and the content opportunity is expanding as optics penetrate deeper into the data center. We hold positions in Lumentum and Coherent Corp., well-positioned for this multi-year expansion, and in Arista Networks, Inc., whose software moat and hardware leadership make it a core long-term holding. |
| LITE | In the Information Technology and Industrials sectors, our investments in companies benefiting from AI-infrastructure investments contributed to absolute and relative performance, including Taiwan Semiconductor Manufacturing Company Limited (the world's advanced-semiconductor manufacturing champion), Nova Ltd. (leading provider of advanced metrology solutions for semiconductor manufacturing), GDS Holdings Limited (leading China data center operator), Monolithic Power Systems, Inc. (high-performance power management semiconductor leader), Lumentum Holdings Inc. (optical technology leader), and Quanta Services, Inc. (electric grid and energy infrastructure buildout leader). In networking and optical interconnects, all component suppliers are supply constrained and the content opportunity is expanding as optics penetrate deeper into the data center. We hold positions in Lumentum and Coherent Corp., well-positioned for this multi-year expansion, and in Arista Networks, Inc., whose software moat and hardware leadership make it a core long-term holding. |
| COHR | In networking and optical interconnects, all component suppliers are supply constrained and the content opportunity is expanding as optics penetrate deeper into the data center. We hold positions in Lumentum and Coherent Corp., well-positioned for this multi-year expansion, and in Arista Networks, Inc., whose software moat and hardware leadership make it a core long-term holding. |
| DDOG | Datadog, Inc. has accelerated revenue growth for three consecutive quarters and is one of the largest commercial vendors to nearly every major AI startup; its consumption-based observability platform grows as AI workloads multiply. These stocks are down this year because the market sold the sector indiscriminately — yet all are bigger businesses, growing faster, with stronger competitive positioning than a year ago. We believe these are the types of companies that emerge intact on the other side of the AI transition — and at current valuations, the risk/reward is increasingly attractive. |
| IOT | Samsara Inc. is the market-share leader in connected operations and fleet telematics, with cameras and sensors on millions of commercial vehicles generating 20 trillion data points annually — physical and data moats the AI labs cannot easily replicate. |
| SHOP | Shopify grew revenue 30% last year at nearly $12 billion in scale, with founders Tobi Lütke and Harley Finkelstein building the platform for agentic commerce. |
| RBRK | During the first quarter, we initiated a position in Rubrik, Inc., a cloud-based cyber resilience platform that helps enterprises protect, secure, and recover their data across on-premise, cloud, and software-as-a-service environments. Founded in 2014, Rubrik has emerged as what we view as the last line of defense for data recovery and business continuity in an era where ransomware attacks are growing in both frequency and sophistication — and where adversaries are increasingly leveraging AI to craft more evasive attacks that can bypass traditional perimeter defenses. Rubrik's zero-trust, immutable architecture was purpose-built for this threat environment, enabling organizations to maintain secure backups, detect threats across their data estate, and rapidly restore operations when attacks or outages occur. This has driven win rates above 90% in competitive evaluations and rapid market share gains from legacy data backup vendors whose products were designed for a different era of on-premise data centers rather than today's diverse an distributed data environments. More than 6,000 large enterprises rely on Rubrik, and the company ended its most recent fiscal year with approximately $1.5 billion dollars in subscription annual recurring revenue, growing 34%. Beyond its core platform, Rubrik is stacking new growth vectors, including its Identity Resilience product, which grew to over 900 customers in its first year, and Agent Cloud, an AI operations platform that positions the company at the intersection of cyber resilience and the emerging agentic AI infrastructure category. We see a long runway ahead as the more than $20 billion dollar data protection and cyber resilience market expands, driven by intensifying AI-powered cyber threats, data proliferation, and new regulatory mandates. The company's financial profile has also improved dramatically, with free cash flow margins expanding from negative at its initial public offering in April 2024 to 16% on a trailing basis, with a clear path toward further expansion. We believe the combination of accelerating market share capture, new product momentum, and improving profitability positions Rubrik well for long-term growth. |
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