EN 
SE 
June was a strong month for the portfolio, up 6.7% % (return in SEK). Earnings-wise, June is a quiet month, but one of our large holdings, Broadcom, reported strong numbers – and we believe, given the strong performance they forecast, that earnings expectations will need to be raised.
Export figures from both Taiwan and South Korea have shown strong growth: Taiwan’s exports in May rose 18.5 % year-on-year, with comments from the Ministry of Economy highlighting AI servers as a significant driver. South Korea’s exports were also reported for the first 20 days of June, up 8 % year-on-year, with semiconductors up 22 % year-on-year. South Korea is particularly driven by the memory semiconductor market, where prices have increased significantly, driven in part by the huge memory needs of AI servers. Local Taiwanese press reported that Hon Hai has order visibility for AI servers into 2027 – the comments came as the company added more capacity in Texas to try to meet the increased demand. Hon Hai is not owned in the portfolio but is important reading given that it is one of the largest manufacturers of AI servers.
As we commented during Q1 earnings season, all the data points we track point to demand continuing to outstrip supply for AI servers and their components – and the portfolio continues to have significant exposure to the companies we believe are best positioned to generate sustainable long-term returns from that demand. The next key data points for us will come during Q2 earnings season, which begins in a couple of weeks. On the short side, we remain short in some analog semiconductors where we still see cyclical risks, and remain short in some IT services/consulting, where we believe macro uncertainty is impacting the pace of investment.