| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 17.51% | 24.76% | 13.63% |
NZS Capital's Growth Equity strategy returned 24.76% net in Q2 2026, outperforming the index by 9.96% as seemingly insatiable AI infrastructure demand drove strength in semiconductors. All five top contributors came from the semiconductor industry and AI ecosystem, including ARM Holdings, Lam Research, ASML, Taiwan Semiconductor, and Marvell. The manager added NVIDIA back to the portfolio as a resilient position after exiting in Q3 2025, believing lowered valuations compensate for GPU market share risks. The team actively trimmed positions that outperformed into the middle of the portfolio back to optionality, maintaining strict discipline on risk management. Quanta Services was promoted to resilient given narrowing outcomes for grid infrastructure. The manager finds Healthcare increasingly attractive following post-pandemic recovery, with fundamentals returning to growth and the sector offering portfolio construction benefits by being untethered to AI capex. Despite steep derating in quality growth stocks outside AI, the team added materially to Intuitive Surgical, Axogen, and other healthcare names. The portfolio remains overweight Information Technology, Industrials, and Healthcare with 50-65 concentrated positions.
NZS Capital maintains concentrated exposure to AI infrastructure and semiconductors while selectively adding to Healthcare where multiple compression has created attractive entry points despite improving fundamentals and emerging tailwinds.
The manager views the current environment as presenting attractive opportunities in Healthcare given improving fundamentals, potential emerging tailwinds, and portfolio construction benefits from the sector being uncorrelated to AI capex spending. The team continues to maintain overweight positions in Information Technology, Industrials, and Healthcare. The manager expects to benefit from continued AI infrastructure demand while maintaining discipline around position sizing for stocks with wide ranging outcomes. The tone is constructive with selective optimism around specific sectors and themes, particularly where valuations have compressed despite solid fundamentals.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jul 16 2026 | 2026 Q2 | 300750.SZ, ARM, ASML, AXGN, CRWD, CSGP, DDOG, DSGX, ISRG, LITE, LRCX, LSCC, MRVL, NTDOY, NVDA, ON, PWR, SNOW, TSM, TYL | AI, growth, healthcare, infrastructure, Quality, semiconductors, technology | - | NZS Capital delivered 24.76% net returns in Q2 2026 driven by concentrated semiconductor exposure capturing AI infrastructure demand. The manager re-entered NVIDIA at attractive valuations while trimming momentum winners back to optionality. Healthcare presents compelling opportunities with improving fundamentals and multiple compression creating entry points. The portfolio maintains disciplined concentration in AI ecosystem, grid infrastructure, and select healthcare innovators with narrowing outcome ranges. |
| Apr 25 2026 | 2026 Q1 | ARM, ASML, CSU.TO, DHR, FROG, ISRG, IT, LIN, LRCX, SYK, TEAM, TSM, TYL, WDAY | AI, disruption, growth, healthcare, semiconductors, software, technology | TYL | NZS Capital's growth strategy fell 8.91% in Q1 as AI disruption fears hammered software while semiconductors outperformed on infrastructure demand. The manager is aggressively buying the software selloff, focusing on vertical market players with defensible moats. Healthcare additions capitalize on normalized fundamentals and GLP-1 tailwinds. Current growth valuations offer compelling multi-year opportunities. |
| Jan 26 2026 | 2025 Q4 | AJG, APH, ASML, CDNS, CMG, CSU.TO, DHR, DNP.WA, FI, FND, FROG, GOOGL, HRTX, ISRG, LIN, LRCX, MNDY, PGR, ROP, TSM, URI | AI, growth, positioning, semiconductors, software, technology, valuation |
GOOGL DHR FISV LRCX TSM ISRG |
NZS delivered strong full-year returns despite Q4 underperformance, driven by semiconductor and AI-related holdings. The firm sees opportunity in software companies feared to be displaced by AI, believing systems of record will adapt through integration. Portfolio rebalanced away from IT as valuations recovered, adding quality growth names trading at attractive multiples. |
| Oct 20 2025 | 2025 Q3 | ADSK, AMT, APH, ASML, CMG, CSU.TO, DHR, FI, GOOGL, IT, LRCX, MCHP, MPWR, NOW, ROP, SNPS, TEAM, TSM, URI, WDAY | AI, cybersecurity, growth, Identity, semiconductors, software, technology |
SAIL SAIL |
NZS Capital underperformed in Q3 but maintains strong YTD returns while navigating AI transformation by avoiding narrow predictions. The firm increased resilient positioning, exited NVIDIA, and added software positions believing AI expands rather than shrinks the software market. Focus on SailPoint reflects opportunity in identity governance as machine identities proliferate with AI adoption. |
| Jul 18 2025 | 2025 Q2 | 1211.HK, APH, ARM, CDNS, CPRT, DHR, FI, FND, GLBE, GOOGL, HEI, IR, LRCX, MELI, MRVL, MSFT, NET, NVDA, PGR, PWR, ROP, SAIL, TOST, TSM | growth, Portfolio Management, semiconductors, software, technology, volatility |
TOST TOST |
NZS delivered strong Q2 returns of +19.39% by actively managing volatility through their resilient-optionality framework. Technology led performance with Amphenol benefiting from data center demand. The team added to quality names during weakness while introducing new positions in Ingersoll Rand and Quanta Services, demonstrating their ability to capitalize on market dislocations. |
| Apr 24 2025 | 2025 Q1 | 1211.HK, AMT, APH, CDNS, GLBE, GOOGL, HEI, LIN, LMND, MCHP, MRVL, NVDA, PCOR, PGR, RDDT, TEAM, TSM, TT | aerospace, AI, growth, optionality, Resilience, technology, volatility | HEI | NZS Capital underperformed in Q1 2025 but demonstrated portfolio resilience amid broad market volatility. Management is most excited about opportunities in recent years, actively deploying capital into both resilient and optionality positions. Their non-zero-sum investment philosophy targets companies creating ecosystem value, with current market dispersion favoring their active selection approach for multi-year returns. |
| Jan 23 2025 | 2024 Q4 | 6367.T, AMT, ANSYS, ASML, AXON, DHR, FI, GOOGL, GTLS, LIN, MCHP, MRNA, NVDA, PGR, SHOP, SNOW, TEAM, TSM, TT, WDAY | AI, global, growth, innovation, Resilience, semiconductors, technology | - | NZS Capital delivered 21.25% returns in 2024 despite a weak Q4, driven by their resilience-focused strategy of holding adaptable, innovative businesses. Strong performers included Fiserv and Axon, while semiconductor exposure faced headwinds. The firm added new optionality positions and remains optimistic about AI infrastructure investments and end market recovery over the next five years. |
| Oct 10 2023 | 2024 Q3 | ADYEY, AMT, ASML, CDNS, CPRT, DHR, FI, GOOG, LRCX, LSCC, MCHP, MRNA, MSFT, NFLX, NVDA, PGR, ROP, TT, URI | AI, Automation, Digital, growth, insurance, semiconductors, technology | PGR | NZS Capital's growth strategy lagged in Q3 as markets rotated from AI/tech to cyclicals, hurting semiconductor positions while financials and industrials outperformed. The firm trimmed mega-cap tech, added resilient AI exposure, and positioned for cyclical recovery. Despite near-term AI investment uncertainty, they remain bullish on digital disruption themes and expect 2025 catalysts from Fed clarity and election resolution. |
| Oct 7 2023 | 2024 Q2 | ADYEN.AS, APH, ASML, CDNS, CMG, CSGP, DOL.TO, FI, GOOGL, HEI, ISRG, LRCX, MELI, NFLX, NVDA, PCOR, TSM, TSMC, TT, WDAY | AI, growth, portfolio, semiconductors, software, technology, Valuations | TSM | NZS Capital trimmed AI-beneficiary positions including Nvidia and TSMC despite strong performance, citing valuation concerns and uncertainty around $200 billion annual AI spending sustainability. Exited Workday amid enterprise software slowdown. Portfolio emphasizes Non-Zero Sumness philosophy, seeking companies creating more value than they capture while positioning for next wave of market-dominating businesses. |
| Jan 16 2024 | 2023 Q4 | ADSK, ADYEN.AS, AMD, AMZN, ANSS, ASML, BALL, CCJ, DHR, GTLS, MRNA, MSFT, NEE, NVDA, RGEN, SHOP, SWAV, TSLA, TT, WDAY | AI, Cloud, Energy Transition, growth, innovation, semiconductors, technology | 1102 TT | NZS delivered strong Q4 performance through disciplined stock selection, avoiding Magnificent Seven momentum while maintaining innovation focus. Portfolio balances resilient holdings like Trane Technologies with optional positions, emphasizing companies creating win-win outcomes. Manager expects broader market in 2024 as AI transforms industries beyond technology, positioning for fundamental-driven returns over momentum trades. |
| Nov 1 2023 | 2023 Q3 | ADYEN.AS, APH, ASML, BALL, CCJ, CMG, DHR, DOX, FI, GOOGL, HXGBY, MCHP, NEE, OKTA, PGR, RGEN | AI, Automation, Energy Transition, growth, innovation, semiconductors, technology | ACGL|APH|COO|CSGP|DKNG|GWRE|IDXX|IOT|IT|LPLA|MSCI|MTD|PCOR|ROP|TECH|VRSK | NZS underperformed in Q3 as semiconductor and payment holdings declined, but maintains conviction in digital transformation thesis. Added uranium miner Cameco and connector maker Amphenol to benefit from energy transition and electronics proliferation. Expects AI to drive productivity gains and deflation while creating wider performance dispersion between adaptive companies and laggards. |
| Aug 1 2023 | 2023 Q2 | AMZN, ASML, BALL, CDNS, CGNX, CSTM, DHR, FI, GOOGL, ISRG, LIN, LRCX, MSFT, OKTA, PGR, PYPL, RGEN, SUI, TXN, WDAY | AI, Cloud, Digital Economy, growth, innovation, semiconductors, technology | - | NZS outperformed in Q2 driven by mega-cap tech and semiconductor equipment strength. The manager maintains conviction in digital economy enablers while noting AI has increased uncertainty and disruption risk across all companies. They trimmed semiconductor exposure after AI-driven rallies but remain long-term bullish on the sector as a key AI enabler. |
| Apr 27 2023 | 2023 Q1 | ABNB, AMZN, ASML, BALL, CDNS, CRM, CSGP, CSTM, DHR, GOOGL, LIN, MELI, MRNA, MU, NEE, NTDOY, NVDA, ORSTED.CO, TSM, WDAY | AI, Digital Transition, growth, innovation, semiconductors, technology | - | NZS Capital delivered strong Q1 performance driven by technology and AI beneficiaries, outperforming benchmarks by 9 percentage points. The firm positioned for AI acceleration by favoring semiconductor infrastructure providers while maintaining underweight exposure to vulnerable financial institutions. They view generative AI as transformative and expect markets to shift from macro concerns toward company-specific fundamentals as rate compression nears completion. |
| Mar 2 2023 | 2022 Q4 | - | - | - | |
| Nov 10 2022 | 2022 Q3 | - | - | - | |
| Nov 7 2022 | 2022 Q2 | - | - | - | |
| Apr 18 2022 | 2022 Q1 | - | - | - | |
| Jan 10 2022 | 2021 Q4 | 3659.T, APH, ASML, CCI, DIS, GOOGL, LRCX, MCHP, MSFT, NVDA, PARA, PTON, PYPL, RDFN, SNAP, SUI, TMUS, TTWO, ZEN, ZG | digital transformation, growth, Resilience, semiconductors, technology | - | NZS Capital outperformed in 2021 by focusing on the analog-to-digital transition with concentrated positions in resilient technology companies. Semiconductor names like NVIDIA and ASML drove performance while consumer discretionary holdings like Peloton detracted. Despite near-term market uncertainty around rates and inflation, the manager maintains conviction in long-term digital transformation themes. |
| Oct 11 2021 | 2021 Q3 | 3659.T, ADYEN.AS, ASML, BLL, CCI, CDNS, CMG, CRM, LRCX, MSFT, PTON, SAIL, SUI, TMUS, TSM, VIAC | AI, digital transformation, growth, semiconductors, software, technology | - | NZS Capital outperformed in Q3 2021 with their technology-heavy portfolio benefiting from digital transformation themes. The manager views current AI hype skeptically, comparing it to the dotcom bubble, while remaining bullish on semiconductors and software as transformation enablers. They see market unpredictability as opportunity rather than risk. |
| Jul 9 2021 | 2021 Q2 | 3659.T, BALL, CRM, CSTM, DIS, KLAC, MCHP, MSFT, MU, NET, NVDA, ON, SHOP, THO, TMUS, WDAY | Adaptable, Digital Transition, growth, long-term, technology | - | NZS Capital delivered 7.41% net returns in Q2 2021, maintaining focus on the analog-to-digital economic transition. Technology holdings dominated performance with strong contributions from Nvidia, Cloudflare, and Microsoft, while semiconductors underperformed. The firm views recent value rotation as temporary and continues positioning for long-term digital transformation beneficiaries through adaptable, stakeholder-focused companies. |
| Apr 5 2021 | 2021 Q1 | ASML, BALL, CRM, LRCX, TTWO, TXN, VIAC, ZEN | Digital Transition, growth, inflation, semiconductors, technology, Valuations | - | NZS Capital outperformed in Q1 2021 with their digital transformation thesis, led by semiconductor winners. Rising rates hit growth stocks mid-quarter, but the firm used volatility to rebalance toward Optionality positions. Technology dominance at 58% weighting reflects their conviction in companies creating stakeholder value during the analog-to-digital economic transition. |
| Jan 11 2021 | 2020 Q4 | AMZN, APD, CCI, CDNS, CMCSA, CRM, DIS, HEI, LRCX, LYFT, MCHP, MRNA, NVDA, SAIL, TSLA, TSM, VIAC, ZEN | digital transformation, growth, long-term, optionality, Resilience, technology | - | NZS Capital's technology-focused growth strategy delivered 62.44% net returns in 2020, significantly outperforming benchmarks through concentrated positions in semiconductors and software. The firm combines resilient businesses with optionality plays to capitalize on the analog-to-digital transition, maintaining optimism about long-term technology deflation trends despite acknowledging current bubble-like market dynamics and valuation concerns. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q2 |
AIAI infrastructure demand drove strong performance in semiconductors during Q2 2026. The portfolio's overweight in semiconductors, particularly companies in the AI infrastructure ecosystem like ARM, Lam Research, ASML, Taiwan Semiconductor, and Marvell, contributed significantly to outperformance. The manager notes seemingly insatiable demand for AI infrastructure and views NVIDIA's growth relative to competitors as evidence that GPUs are taking share in AI compute. |
AI Infrastructure Semiconductors GPUs AI Compute |
SemiconductorsSemiconductors were the top contributors to absolute returns, with all five top individual contributors coming from this industry. The manager added NVIDIA back to the portfolio as a resilient position after previously exiting in Q3 2025, believing the lowered valuation compensates for market share risks. The improving outlook for chips broadly and strengthening tailwinds for equipment suppliers like Lam Research reflect positive sector momentum. |
Chip Manufacturing Semi Equipment Foundries Memory | |
HealthcareThe manager finds Healthcare increasingly attractive following the post-pandemic hangover, with fundamentals returning to growth. They believe disruptive forces like GLP-1s may have net positive impacts on industry growth, benefiting orthopedics and drug manufacturing suppliers. The sector is viewed as valuable for portfolio construction due to being untethered to AI infrastructure capex. The manager added capital to Intuitive Surgical, HeartFlow, Stryker, Axogen, and WuXi XDC despite significant multiple compression in the sector. |
Medical Devices Biotechnology Drug Manufacturing Orthopedics | |
QualityThe manager discusses a steep derating in the quality growth cohort, with businesses not deemed AI beneficiaries seeing valuations cut significantly. Capital appears to be reallocated from quality growth stocks to feed AI investments. The manager acknowledges understanding most of the factors underlying this capital rotation, though expresses some surprise at the extent of multiple compression in certain sectors like Healthcare. |
Quality Growth Valuations Multiple Compression | |
Grid UpgradeQuanta Services was promoted from optional to resilient position during the quarter, reflecting the manager's view that the fundamental range of outcomes for this US provider of craft labor for electricity generation, transmission, and distribution infrastructure has continued to narrow. This suggests growing conviction in grid infrastructure investment opportunities. |
Transmission Electrical Equipment Infrastructure Spending | |
| 2026 Q1 |
AIAI infrastructure demand continues driving strong performance in semiconductor capital equipment companies like ASML, Lam Research, and TSMC. However, AI disruption concerns are creating indiscriminate selling pressure across software companies, with the market fearing displacement of incumbents and seat reduction risks from AI efficiency gains. |
Infrastructure Disruption Software Semiconductors Efficiency |
SemiconductorsSemiconductor companies were top contributors with strong demand for compute in AI infrastructure and unprecedented memory demand fueling continued growth in capital equipment spending. TSMC, ASML, and Lam Research all benefited from these tailwinds. |
Capital Equipment Memory AI Infrastructure Compute | |
Enterprise SoftwareSoftware sector experienced sharp decline over AI disruption concerns, with broad-based selling creating compelling multi-year opportunities. Manager is positioning around companies with high non-zero-sum value, vertical market focus, and consumption-based pricing to mitigate AI displacement and seat risks. |
SaaS Vertical Software Disruption Pricing Models | |
HealthcareHealthcare weight increased as fundamentals normalized after post-COVID hangover and valuations became less demanding. Increasing lifespans from GLP-1 adoption may provide sector tailwinds. Added Stryker as new resilient position and promoted Intuitive Surgical. |
Fundamentals Valuations Medical Devices | |
GrowthGrowth stocks experienced particular weakness in Q1 as markets grappled with increased uncertainty and upward bias to inflation and interest rate expectations. Portfolio's growth equity focus led to underperformance versus the index. |
Valuations Interest Rates Inflation | |
| 2025 Q4 |
AIAI has been the defining theme of market leadership in 2025, driving data center capex and benefiting companies like Bloom Energy and Sandisk. However, concerns over the durability of the AI theme led to market rotation in early Q4 before reasserting dominance after NVIDIA's strong earnings. |
Data Centers Semiconductors Storage Infrastructure |
ElectrificationThe portfolio maintains its largest absolute and relative exposure to the Industrials sector, representative of conviction in the Electrification theme. However, exposure to some larger holdings in this theme has been modestly reduced during the quarter. |
Industrial Power Grid Energy | |
AerospaceThe portfolio retains conviction in the Aerospace theme alongside Electrification, maintaining significant exposure to the Industrials sector. Rocket Lab, an end-to-end space company, was added as a new position during the quarter. |
Space Defense Launch Satellites | |
BiotechnologyBiotech was a standout performer during the quarter, delivering its best quarter in five years driven by improving rate environment, easing regulation with more M&A, and excitement around AI's promise in drug discovery efficiency. |
Pharmaceuticals Drug Discovery M&A Regulation | |
SolarFirst Solar benefited from Trump Administration's 'One Big Beautiful Bill' which drove US demand for non-China solar products. The company differentiates with thin-film CdTe technology offering better performance in challenging conditions. |
Renewable Manufacturing Policy Technology | |
| 2025 Q3 |
AINZS discusses AI as the largest platform shift yet, threatening business models while promising productivity advances. They emphasize the widening range of outcomes and the need to avoid narrow predictions in AI investing. The firm highlights AI's expansion of the total addressable market for identity governance and security software. |
Artificial Intelligence Platform Shift Machine Identities AI Agents Productivity |
CybersecurityThe letter focuses extensively on identity governance and administration through SailPoint, highlighting the emergence of AI-era cybersecurity vulnerabilities. They discuss zero-trust security adoption and the dramatic expansion of the addressable market as AI agents create new security challenges requiring governance of non-human identities. |
Identity Governance Zero-Trust Machine Identities AI Security Access Management | |
SemiconductorsMultiple semiconductor companies contributed positively to returns, with Lam Research and ASML benefiting from increased enthusiasm around memory spending tied to AI. Taiwan Semiconductor was also among top contributors, reflecting the sector's importance in the AI infrastructure buildout. |
Memory AI Infrastructure Semiconductor Equipment Foundries | |
| 2025 Q2 |
VolatilityNZS views the world as a complex adaptive system subject to frequent shocks and disruptions. Their portfolio construction process is designed to handle volatility by sizing positions based on range of outcomes rather than narrow predictions. The resilient head provides ballast during volatility while the optionality tail captures asymmetry. |
Complex adaptive systems Portfolio construction Risk management Asymmetry Resilience |
Data CentersAmphenol significantly exceeded expectations driven by robust demand for components going into data centers. This was the strongest contributor to portfolio performance in the quarter. |
Components Infrastructure Demand Growth | |
Vertical SoftwareToast combines vertical market software and payment processing, focusing on the restaurant industry. They evolved from a cloud-based POS system into a software platform that functions as the operating system of a restaurant. The company is taking a digital approach to a market previously underserved by technology. |
SaaS Payments Restaurant technology Digital transformation Platform | |
| 2025 Q1 |
AIMarkets experienced volatility with particular weakness in AI-related stocks. Alphabet was weak due to larger-than-expected capital expenditure outlook and perceived widening range of outcomes for AI, though the manager remains optimistic about Alphabet's positioning in AI. The portfolio was intentionally ringfenced for AI exposure in 2024 due to valuation concerns. |
Artificial Intelligence Capital Expenditure Alphabet Valuations Technology |
AerospaceHEICO is highlighted as a focus position, operating in the aircraft aftermarket parts industry. The company supplies aftermarket parts at 30-50% discounts versus OEM suppliers, saving customers hundreds of millions annually. The aerospace aftermarket market is growing at multiples above air passenger miles growth but remains largely unpenetrated relative to total commercial aftermarket spending. |
Aftermarket Parts Airlines FAA PMA Parts Aviation | |
ResilienceThe strategy displayed resilience amid market volatility, attributed to portfolio construction and stock selection. Progressive and HEICO were highlighted as resilient holdings that contributed positively. The manager emphasizes seeking companies with adaptable resilience and made additions to resilient holdings including Trane, Cadence, and Amphenol. |
Portfolio Construction Volatility Adaptable Defensive Quality | |
| 2024 Q4 |
AINZS is positive about the long-term potential of AI while remaining cognizant of diverse range of outcomes at various layers. They continue to invest more heavily in the infrastructure layer, which benefits from ongoing spending tied to the AI buildout, regardless of who the end-game winners might be. The foundational model and application layers have the most open-ended trajectories. |
Infrastructure LLMs Applications Buildout Technology |
ResilienceNZS relies on proven lessons from the natural world, which favors individuals, species, and entities that exhibit both resilience and adaptability when faced with constantly changing and unpredictable conditions. They hold a collection of adaptable and innovative businesses at justifiable valuations. Several new resilient stocks added during 2022 contributed meaningfully to the portfolio in 2024. |
Adaptability Innovation Diversification Natural World Positioning | |
SemiconductorsTaiwan Semiconductor was the top contributor for the full year 2024, while Microchip was among the top detractors due to an extended downcycle in semiconductors and company-specific execution issues. ASML underperformed following a reduced 2025 outlook and geopolitical concerns, but NZS added to their position at what they view as a more attractive valuation. |
Downcycle Execution Geopolitical Valuation Outlook | |
| 2024 Q3 |
AIThe manager remains bullish about the long-term implications of AI and is increasingly incorporating it into their research process. However, the market's focus shifted to consider returns on massive AI investments, reflecting concern around the wide range of outcomes. While value has been created at the infrastructure layer, they are still awaiting revenue generating killer apps from this generational technological shift. |
Infrastructure Software Revenue Technology Investment |
SemiconductorsSemiconductor and semiconductor equipment stocks underperformed during the quarter as market excitement over AI and technology waned. The portfolio was hurt by underperformance in this sub-sector, with specific detractors including Lam Research and ASML. The manager added back to Lam Research, Cadence and Lattice on more attractive valuations provided by market rotation. |
Equipment Valuations Technology Rotation Chips | |
AutomationProgressive Insurance exemplifies companies using digital technology to disrupt analog industries through telematics and data-driven approaches. The company pioneered technology to monitor driver safety, allowing better risk assessment and pricing. This digitally enabled approach has allowed Progressive to gain market share and become the second largest auto insurer. |
Digital Technology Data Insurance Disruption | |
| 2024 Q2 |
AIAI enthusiasm drove semiconductor outperformance but created market narrowness concerns. Manager trimmed AI-exposed positions including Nvidia, ASML, Lam Research and Cadence due to uncertainty about sustainability of $200 billion annual AI spending. Portfolio positioned for wide range of outcomes including potential AI spending reduction. |
Semiconductors Data Centers Nvidia Spending Valuations |
SemiconductorsSemiconductor sector led market gains with strong contribution from TSMC and Lam Research. Manager discusses TSMC's strategic pricing philosophy versus Nvidia's opportunistic approach. Trimmed semiconductor positions due to elevated valuations and AI spending sustainability concerns. |
TSMC Foundries Pricing Margins Equipment | |
Enterprise SoftwareSoftware-as-a-service market entered slower growth period due to stringent corporate budgets and delayed IT purchasing decisions. Manager believes SaaS companies need to shift from adjusted earnings focus to reported profitability. Exited Workday due to AI creating winners and losers in enterprise software. |
SaaS Growth Profitability Budgets Workday | |
ValuationsManager wary of narrower assumptions embedded in growth company valuations. Trimmed premium positions like Chipotle and Intuitive Surgical as market plays premium valuations on premier growth businesses. Reduced positions in Trane and Amphenol due to multiple expansion driven by AI enthusiasm. |
Multiples Premium Growth Assumptions Expansion | |
| 2023 Q4 |
AIAI will have transformational impact on society and the economy, drawing focus outside of IT including healthcare. The FDA approved the first CRISPR/Cas9 gene-edited therapy, marking the precipice of curative therapies. AI is boosting digital transformation of scientific research and accelerating innovation in scientific discovery. |
Artificial Intelligence Healthcare Scientific Research Innovation CRISPR |
Energy TransitionTrane Technologies promoted to resilience sleeve as leader in HVAC aligned with decarbonization. Globally 15% of greenhouse gas emissions come from heating and cooling buildings. Growth benefits from regulatory standards, corporate commitments to cleaner buildings, and additional manufacturing infrastructure investment. |
Decarbonization HVAC Energy Efficiency Regulatory Standards Green Buildings | |
SemiconductorsBottoming cycles in memory and capital equipment bolster confidence in broader market. AMD's new product could be strong competitor to Nvidia's products. Portfolio maintains underweight to Nvidia reflecting wide range of outcomes including disappointing scenarios. |
Memory Capital Equipment Competition Cycles Valuation | |
CloudMicrosoft's cloud offering is encroaching on Amazon's opportunity. Sold Amazon to focus on more favorable stocks with similar opportunities. Cloud remains important area for portfolio positioning and stock selection. |
Microsoft Amazon Competition Market Share Enterprise | |
| 2023 Q3 |
AIAI marks a new wave of productivity advances, potentially more impactful than the last 40 years. The infrastructure for AI is mostly in place, unlike previous innovation cycles. AI will bring substantial changes to business models and could be an important driver for deflation. |
Artificial Intelligence Productivity Business Models Infrastructure Deflation |
SemiconductorsSemiconductors are the building blocks of the analog-to-digital economic transformation, including the rise of AI models. The portfolio maintains meaningful exposure despite near-term cyclical concerns, with confidence in long-term prospects of companies like Microchip and ASML. |
Digital Transformation Cyclical Equipment Memory Foundries | |
Energy TransitionThe transition of energy infrastructure and innovation led to investment in Cameco, a uranium miner and processor for nuclear power reactors. The company helps in the shift to greener energy as part of the broader energy transformation. |
Nuclear Uranium Green Energy Infrastructure Power | |
AutomationCompanies are experimenting with collaborative robots and automation to solve structural labor issues. Chipotle is testing cobots to prepare burrito bowls and streamline customer service, representing broader automation trends across industries. |
Robotics Labor Efficiency Manufacturing Service | |
PaymentsThe portfolio maintains exposure to digital payments enablers, though performance was hurt by companies like Adyen facing slower growth and heightened competition in North America, and Fiserv also declining during the quarter. |
Digital Payments Competition Growth Processing Services | |
| 2023 Q2 |
AIThe manager views AI as creating vast opportunity for change with a wide range of outcomes, similar to the early days of the internet. AI has widened the range of outcomes for all companies and increased disruption risk. The manager believes some AI-themed stocks and large platform companies have become marginally less attractive due to this uncertainty. |
Artificial Intelligence Large Language Models Disruption Technology Innovation |
SemiconductorsSemiconductors are viewed as key enablers of AI and many other critical enabling trends of the digital economy. The manager maintains a long-held belief that semiconductors are building blocks of the new AI paradigm and remain long-term opportunities. They trimmed exposure to several semiconductor companies where there has been significant stock reaction in anticipation of AI tailwinds. |
Chips AI Enablers Digital Economy Technology Equipment | |
CloudThe manager discusses how AWS, created by Amazon's ecommerce business, became the platform for nearly every new tech startup across industries from media to fintech. Cloud platforms like AWS enabled businesses like Netflix and Uber to be built on smartphone apps running on Android and iOS. |
AWS Infrastructure Platform Technology Digital | |
| 2023 Q1 |
AIGenerative AI is accelerating innovation and disruption across sectors, with ChatGPT reaching 100M users in two months. Enterprise SaaS companies need AI strategies or risk being left behind by new entrants. The firm adjusted portfolio positioning to favor early AI beneficiaries. |
Generative AI ChatGPT Enterprise Disruption Innovation |
SemiconductorsSemiconductors are crucial to an AI-enabled future and represent infrastructure providers for disruptive forces. AI servers require significantly more memory content, setting up a healthy backdrop for semiconductor equipment companies as markets recover from the current downcycle. |
AI Infrastructure Memory Equipment TSMC Foundries | |
Energy TransitionThe analog-to-digital transition continues across the global economy, with inflationary pressures adding fuel to the digital shift which provides deflation. Reshoring and massive investment in high-tech infrastructure remain attractive opportunities. |
Digital Transition Infrastructure Reshoring Deflation | |
| 2021 Q4 |
TechnologyTechnology was the top performing sector for the year and quarter, with significant positions in semiconductor equipment companies like Lam Research, ASML, and KLA. The strategy maintains an overweight position in technology as part of its focus on the analog-to-digital transition. |
Semiconductors Digital Innovation |
SemiconductorsMultiple semiconductor and semiconductor equipment companies were top contributors including NVIDIA, ASML Holding, Lam Research, Microchip, KLA, and Micron. The strategy views semiconductor companies as beneficiaries of the long-term digital transformation. |
Semi Equipment Memory Foundries | |
ResilienceThe portfolio construction combines Resilient companies with larger positions that have very few predictions underpinning their success and a narrow range of outcomes. These adaptable businesses are expected to take share as the economy transitions from analog to digital. |
Adaptable Durability Predictability | |
| 2021 Q3 |
AIManager views AI as primarily a marketing term rather than real technology, comparing it to the dotcom bubble. Warns about dangerous blind faith in AI algorithms that lack transparency and are making critical life decisions. Believes true artificial general intelligence requires massive computational power that may not be economically viable. |
Artificial Intelligence Machine Learning Algorithms Digital Transformation Automation |
SemiconductorsSemiconductors are identified as enduring engines of the analog-to-digital transformation alongside software. The manager sees semiconductors as fundamental enablers of both the previous dotcom wave and the current AI wave of innovation and transformation. |
Chips Technology Digital Transformation Hardware Innovation | |
Energy TransitionThe letter discusses energy challenges including China's power shortages due to dry seasons affecting hydroelectric supply and Europe's wind power issues. These energy disruptions contributed to natural gas price spikes and inflation concerns during the quarter. |
Renewable Energy Natural Gas Hydroelectric Wind Power Energy Supply | |
| 2021 Q2 |
SemiconductorsNZS views semiconductors as the long-term, global engine for the digital economic transition despite underperformance in Q2. Specific semiconductor holdings including Microchip, Micron, On Semi, and KLA Corp detracted from performance in the quarter. |
Semiconductors Digital Technology |
CloudTechnology investments including cloud-focused companies like Salesforce, Microsoft, and Cloudflare contributed strongly to second quarter performance. The firm maintains focus on adaptable technology companies driving the analog to digital transition. |
Cloud Software SaaS | |
| 2021 Q1 |
SemiconductorsSemiconductor companies were top contributors to performance in Q1 2021, with Lam Research, ASML Holding, and Texas Instruments all performing well. The manager views semiconductor investments as part of their technology focus which represents their largest portfolio weighting. |
Semiconductors Technology Equipment |
InflationThe manager discusses rising inflation fears that caused interest rates to jump in February 2021, leading to corrections in high-multiple stocks. They believe the digital transition will be more disinflationary than inflationary long-term, though acknowledge potential pressure from labor costs, housing, and climate change. |
Inflation Rates Valuations | |
| 2020 Q4 |
AIThe letter discusses the AI age and how deflationary trends of technology will accelerate to unprecedented pace as AI emerges. Technology's growing impact on the economy can make humans feel less useful, which could grow with the rise of AI. |
Artificial Intelligence Automation Technology |
Energy TransitionThe letter speculates about electric vehicles and green distributed power systems by 2030. Questions what percent of new and existing cars will be electric and whether we'll be far down the path to creating a green, distributed power system around the planet. |
Electric Vehicles Green Energy Sustainability | |
SemiconductorsSemiconductor companies were top contributors in Q4 including Microchip, Lam Research, and Taiwan Semiconductor. Technology remained the largest weighting at 60.68% with tech investments up 25.56% in the quarter. |
Chips Technology Hardware | |
CloudThe letter discusses foundational platforms, both hardware and software, that will enable a better, more digital future in every sector of the economy. Technology will continue to remove friction from the economy as we transition to a world where nearly every transaction is digital. |
Digital Transformation Software Platforms |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Apr 25, 2026 | Fund Letters | NZS Capital - Growth | TYL | Tyler Technologies | Software - Application | Application Software | Bull | New York Stock Exchange | AI disruption, Court Management, government software, Mission-Critical, Municipal Government, Public safety, Regulatory Software, System of Record, Tax Assessment, vertical market software | Login |
| Jan 26, 2026 | Fund Letters | Brad Slingerlend | GOOGL | Alphabet Inc. | Communication Services | Interactive Media & Services | Bull | NASDAQ | advertising, AI, cloud, Platforms, Search | Login |
| Jan 26, 2026 | Fund Letters | Brad Slingerlend | DHR | Danaher Corp. | Health Care | Life Sciences Tools & Services | Bull | New York Stock Exchange | diagnostics, life sciences, Margins, recovery, recurring revenue | Login |
| Jan 26, 2026 | Fund Letters | Brad Slingerlend | FISV | Fiserv Inc. | Information Technology | Transaction & Payment Processing Services | Bear | New York Stock Exchange | durability, exit, Fintech, Management Reset, Payments | Login |
| Jan 26, 2026 | Fund Letters | Brad Slingerlend | LRCX | Lam Research Corp. | Information Technology | Semiconductor Equipment | Bull | NASDAQ | AI, CapEx, Complexity, Margins, semiconductor equipment | Login |
| Jan 26, 2026 | Fund Letters | Brad Slingerlend | TSM | Taiwan Semiconductor Manufacturing Co. | Information Technology | Semiconductors | Bull | New York Stock Exchange | advanced nodes, AI, Foundry, scale, semiconductors | Login |
| Jan 26, 2026 | Fund Letters | Brad Slingerlend | ISRG | Intuitive Surgical Inc. | Health Care | Health Care Equipment | Bull | NASDAQ | Medtech, Procedures, recurring revenue, robotics, Surgery | Login |
| Oct 20, 2025 | Fund Letters | Brad Slingerlend | SAIL | SailPoint Technologies Holdings Inc. | Information Technology | Cybersecurity | Bull | NYSE | AI, cybersecurity, Enterprise adoption, Identity, SaaS, TAM, Zero trust | Login |
| Oct 20, 2025 | Fund Letters | Brad Slingerlend | SAIL | SailPoint Technologies Holdings Inc. | Information Technology | Cybersecurity | Bull | NYSE | AI, cybersecurity, Enterprise adoption, Identity, SaaS, TAM, Zero trust | Login |
| Jul 18, 2025 | Fund Letters | Brad Slingerlend | TOST | Toast, Inc. | Information Technology | Internet Services & Infrastructure | Bull | New York Stock Exchange | network effects, Payments, Restaurants, SaaS, Software, vertical market | Login |
| Jul 18, 2025 | Fund Letters | NZS Capital - Growth | TOST | Toast | Information Technology | Application Software | Bull | NYSE | Digital transformation, enterprise, Fintech, network effects, payment processing, POS Systems, Restaurant technology, SaaS, SMB, vertical software | Login |
| Apr 24, 2025 | Fund Letters | NZS Capital - Growth | HEI | HEICO Corporation | Industrials | Aerospace & Defense | Bull | NYSE | Acquisitions, Aerospace, Aftermarket Parts, Airlines, cost savings, Decentralized, Defense, FAA Approved, manufacturing, market leader, PMA Parts, Quality Track Record | Login |
| Sep 30, 2024 | Fund Letters | NZS Capital - Growth | PGR | Progressive Corporation | Financials | Property & Casualty Insurance | Bull | NYSE | Auto Insurance, combined ratio, Data Analytics, Digital Disruption, market share gains, risk assessment, technology, Telematics | Login |
| Sep 30, 2023 | Fund Letters | NZS Capital - Growth | ACGL|APH|COO|CSGP|DKNG|GWRE|IDXX|IOT|IT|LPLA|MSCI|MTD|PCOR|ROP|TECH|VRSK | Amphenol Corporation | Information Technology | Electronic Components | Bull | NYSE | 5G, Acquisitions, Aerospace, automotive, Connectors, data centers, Decentralized, Digital transformation, Electronic Components, Industrial, Physical World Innovation, Sensors | Login |
| Dec 31, 2023 | Fund Letters | NZS Capital - Growth | 1102 TT | Trane Technologies | Industrials | Building Products | Bull | NYSE | Building Products, Climate Solutions, Decarbonization, Digital Connectivity, energy efficiency, HVAC, Industrials, Transport Refrigeration | Login |
| - | Fund Letters | NZS Capital - Growth | TSM | Taiwan Semiconductor Manufacturing Company | Information Technology | Semiconductors & Semiconductor Equipment | Bull | NYSE | AI, Foundry, Leading Edge, manufacturing, Monopoly, semiconductors, Strategic Pricing, Taiwan | Login |
| TICKER | COMMENTARY |
|---|---|
| ARM | ARM Holdings shares were further lifted by the company's announced plan to develop its first in-house chip, a CPU for AI workloads. This quarter, the portfolio had five positions that worked their way into the middle. In the cases of ARM Holdings, Marvell, Lattice Semiconductor, and Snowflake, we trimmed the positions back to optionality. |
| LRCX | Lam Research, which is a critical supplier of etching equipment used in the production of semiconductors, saw strengthening tailwinds to their outlook as some key chip manufacturing customers publicly committed to higher capital expenditures to expand capacity. |
| ASML | ASML Holdings was a top-five contributor. We also added materially to ASML. |
| TSM | Taiwan Semiconductor was a top-five contributor. |
| MRVL | Marvell was a top-five contributor. Marvell rallied significantly after Jensen Huang extolled the company as 'the next trillion-dollar company' on stage at Computex in Taiwan. While we agree it's within the range of outcomes, in our view, Jensen's statement only resulted in the market applying a higher valuation to a stock whose fundamental range of outcomes remained unchanged; thus, we trimmed Marvell. |
| ISRG | Intuitive Surgical was the top individual detractor to absolute returns in the quarter. While fundamentals remain solid for Intuitive Surgical, the stock's multiple has not been immune from the broad de-rating in 'quality growth' stocks we've seen outside of the AI ecosystem. Last quarter we incrementally added net capital to some of our existing holdings in the sector, including Intuitive Surgical. We also added materially to Intuitive Surgical. |
| NTDOY | Nintendo was weak in the period after issuing forward guidance that disappointed due to the increasing costs of memory chips going into their gaming hardware. |
| TYL | Tyler Technologies was one of the other top-five detractors. |
| ON | ON Semiconductor was one of the other top-five detractors. Other new additions to the portfolio were optionality positions in ON Semiconductor. |
| CSGP | CoStar Group was one of the other top-five detractors. |
| LSCC | In the cases of ARM Holdings, Marvell, Lattice Semiconductor, and Snowflake, we trimmed the positions back to optionality. |
| SNOW | In the cases of ARM Holdings, Marvell, Lattice Semiconductor, and Snowflake, we trimmed the positions back to optionality. |
| PWR | Quanta Services also ran into the middle during the quarter, and we ultimately decided to add capital and promote the position to resilient, reflecting our view that the fundamental range of outcomes for Quanta's business – a US provider of craft labor for electricity generation, transmission, and distribution infrastructure – has continued to narrow. |
| NVDA | NVIDIA was added back to the portfolio as a resilient position late in the quarter. NVIDIA had been a long-time holding in the portfolio before we exited in the third quarter of 2025. The stock has since lagged the broad surge in the AI semiconductor ecosystem as the market began contemplating budding risks to the GPU's market share in AI compute. This scenario was our primary concern when we exited the position, but we now think the lowered valuation more than compensates for this type of risk. Further, NVIDIA's growth relative to competitors indicates the GPU is actually taking share at present. |
| DSGX | Other new additions to the portfolio were optionality positions in Descartes. |
| 300750.SZ | Other new additions to the portfolio were optionality positions in CATL. |
| CRWD | Other new additions to the portfolio were optionality positions in CrowdStrike. |
| DDOG | Other new additions to the portfolio were optionality positions in Datadog. |
| LITE | Other new additions to the portfolio were optionality positions in Lumentum. |
| AXGN | Other new additions to the portfolio were optionality positions in Axogen. Axogen provides nerve grafts used for peripheral nerve repair. Following BLA approval of their Avance nerve allograft and related positive momentum in insurance coverage, we think Axogen is highly asymmetric to a future where nerve repair becomes standard-of-care, including for patients undergoing a mastectomy or prostatectomy. |
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