In August, the second quarter earnings season continued, with positive results from many of our portfolio companies, although overall portfolio performance was dampened by a generally weaker market and continued macroeconomic concerns around interest rates and inflation, as well as the effects of tariffs.<\/p>\n\n\n\n
In terms of company fundamentals, we continued to see strong results from our AI-exposed companies \u2013 TSMC (which reported its Q2 results in July) reported strong July sales again, and more generally, Taiwanese July sales figures showed continued strength, indicating a strong build-out of Nvidia's latest systems.<\/p>\n\n\n\n
Arista Networks (owned) showed that AI demand is much more than just computers and GPUs \u2013 they see a much greater demand for their high-performance networking systems.<\/p>\n\n\n\n
August also saw the launch of the latest ChatGPT-5 model, which we believe will continue to support the shift to reasoning models, one of the biggest drivers of increased demand for computing.<\/p>\n\n\n\n
On the short side, we are still short in some analog semiconductors, where we still see cyclical risks, and still short in some IT services\/consulting, where we believe macro uncertainty is impacting some business cycles. The fund fell 3% in August, despite what we see as fundamental strength in our portfolio companies.<\/p>\n\n\n\n