Tom Slater: Manager Review
Tom Slater – Manager, Scottish Mortgage
- Scottish Mortgage’s portfolio companies are leading global transformation across AI, digital platforms, and electrification, fuelling strong performance
- From ASML to MercadoLibre, the most dynamic firms are scaling globally, turning technological disruption into durable, long-term growth
- New holdings such as Anthropic, Xiaohongshu and CATL highlight our focus on the next generation of innovators shaping how the world works and connects
As with any investment, your capital is at risk.
Performance
The six months to 30 September 2025 have been a period of meaningful progress, not only in markets, but more importantly, in the companies leading fundamental change. Scottish Mortgage’s Net Asset Value rose by 22 per cent, ahead of the FTSE All-World Index’s 12 per cent gain. The share price increased by 21 per cent.
These results reflect renewed investor interest in innovation and growth but also a recognition that many of the companies driving transformation have emerged from the recent dislocation stronger, more efficient, and more ambitious.
A Global Engine of Progress
This period’s strongest returns came from companies building real capabilities across a wide range of sectors and geographies. It has become increasingly clear that the forces reshaping the global economy, from artificial intelligence to digital commerce and electrification, are not confined to any one country or industry. Our top contributors reflected this global diversity.
The build-out of artificial intelligence infrastructure continues to accelerate, and the companies enabling this transformation are increasingly being recognised for their strategic value. Our holdings in ASML and TSMC, essential suppliers to the world’s most advanced chipmakers, delivered strong returns as investment in computing power remained a top priority for both enterprises and governments. The performance of NVIDIA reinforced the broader opportunity around AI hardware and software. Further up the stack, Cloudflare and Snowflake benefited as businesses continued upgrading their digital architecture to better handle distributed workloads, data integration, and AI-enhanced applications.
The expansion of digital platforms, both consumer- and enterprise-facing, also contributed significantly. Companies like Roblox, Meta, and Spotify appreciated as user engagement and monetisation improved. In each case, long-term product and network investments are bearing fruit. These platforms have shown that when usage and creator ecosystems deepen, business models become more resilient and scalable. Likewise, Netflix demonstrated that disciplined content investment and pricing power can still produce robust growth in a more mature market.
In commerce and logistics, our holdings in MercadoLibre and SEA performed well. These businesses, often underappreciated due to their regional focus in Latin America and Southeast Asia, are building scaled and profitable ecosystems not just in ecommerce, but also in digital payments and financial services. The story is similar at Shopify and Doordash, which capitalised on previous infrastructure investment to improve profitability and capital efficiency.
We also saw renewed investor attention in companies tied to electrification and clean energy. CATL, the dominant Chinese battery manufacturer, and Tesla, a long-standing holding, both contributed positively. Despite differing regulatory and competitive dynamics, each benefit from the global trend toward electrification, and from deep vertical integration in their respective segments.
Underlying all these businesses is a shared set of characteristics: the ability to scale efficiently, to benefit from compounding network or data effects, and to operate with a long-term view in sectors undergoing structural change.
Whether in Taiwan, Brazil, Sweden, Singapore or Silicon Valley, these companies are pushing the boundaries of what’s possible and the market has begun to take notice.
Investing in the Next Generation
In recent months, we have introduced a number of new holdings that reflect how the global economy is changing. While the sectors vary, the companies share important traits: they are founder-led, ambitious, and well placed to benefit from long-term shifts in technology, consumer behaviour and energy.
A key area of interest for us is the way people work, create, and interact online. We invested in Figma, which is becoming the standard design tool for building websites, apps and digital services. It helps teams work together in real time and is already used by many of the world’s largest companies. We also bought shares in AppLovin, a company that helps mobile games and apps reach the right audiences through better advertising. As people spend more time on their phones, AppLovin is helping app developers grow their businesses more efficiently.
We continue to look for platforms that understand the next generation of internet users. Xiaohongshu, or “Little Red Book”, is one of the most popular lifestyle platforms in China. Its users are mostly young and urban and use it to discover products and share ideas about fashion, beauty, travel and more. The platform is growing quickly but still has lots of room to expand through advertising and ecommerce.
Electrification remains one of the most important global trends. We added CATL, the world’s largest battery maker, which supplies electric vehicle and energy storage companies across Asia, Europe and the US. We also added to our position in BYD, a Chinese company that makes electric cars and buses. Both companies are positioned to benefit as transport systems shift away from fossil fuels.
Finally, we invested in Anthropic, a company building the next generation of artificial intelligence. While still at an early stage, it is one of a small number of teams globally with the expertise to train powerful AI models. These technologies could reshape how people interact with software, and how information is processed and used. We believe the company has the right mix of technical depth, safety focus and commercial potential. Anthropic (like Xiaohongshu) is a private company. Access to private companies is a necessity for investors wanting exposure to the new generation of companies focused on training AI models.
Funding has come from reductions in holdings such as Amazon, Roblox, Spotify, Meta Platforms, Netflix, Tempus AI, MercadoLibre and Shopify. Each has delivered operational progress, often with improved financial performance or renewed investor recognition. These reductions were not driven by any loss of conviction. On the contrary, we remain supportive of their long-term potential and in all cases retain meaningful positions.
Beneath the Headlines
Global conditions remain uncertain, but they are less chaotic than they were a year or two ago. Inflation has eased meaningfully from its post-pandemic peaks, though it remains above historical norms in many parts of the world. Interest rates appear to have peaked for now, and while central banks are in no rush to ease, market expectations are more stable than they have been in some time. Geopolitical tensions from US-China rivalry to regional conflicts continue to shape supply chains and national policy. However, we believe the most important shifts are not occurring in policy corridors, but in labs, datacentres, and factories around the world.
This is a period of deep technological transformation. AI is reshaping how businesses operate and how decisions are made. The infrastructure powering that change is in high demand. But progress is not limited to computing. We're seeing progress in areas as diverse as personalised healthcare, electrification, logistics, and digital content. The companies driving these shifts operate across continents, cultures, and sectors but they share the same ambition to reimagine what’s possible.
Patience, Rewarded
Periods of strong performance are welcome, but they do not change our approach. We are not chasing short-term trends or market approval. We are long-term owners, focused on identifying the exceptional few companies that can deliver transformational outcomes over decades.
Many of the companies that contributed most this period did so after long stretches of being out of favour. Their short-term returns were not linear nor were they predictable. But they reflect what we believe is the essence of successful investing: patience in the face of noise, and conviction in the face of doubt.
We thank shareholders who share that mindset. Our task is to seek out the rare businesses creating the future, and to support them with long-term and constructive ownership, wherever in the world they may be.
Annual Past Performance To 30 September each year (net %)
| 2021 | 2022 | 2023 | 2024 | 2025 | |
| Share Price | 44.5 | -45.0 | -13.9 | 25.6 | 36.5 |
| NAV | 39.4 | -36.3 | -5.9 | 16.8 | 33.3 |
| Benchmark* | 22.7 | -3.6 | 11.1 | 20.2 | 17.4 |
Source: Morningstar, total return, sterling. NAV stands for Net Asset Value.
*FTSE All World Index(GBP) TR.
Past performance is not a guide to future returns.
Risk Factors
Unlisted investments such as private companies, in which the Trust has a significant investment, can increase risk. These assets may be more difficult to sell, so changes in their prices may be greater.
The trust invests in overseas securities. Changes in the rates of exchange may also cause
the value of your investment (and any income it may pay) to go down or up.
179211 10058771
About the author - Tom Slater
Manager, Scottish Mortgage
Tom Slater is manager of Scottish Mortgage. He joined Baillie Gifford in 2000 and became a partner of the firm in 2012. Tom joined the Scottish Mortgage team as deputy manager in 2009, before assuming the role of Manager in 2015. Beyond that, he is the head of the US Equities team and a member of another long-term growth equity strategy. During his time at Baillie Gifford, Tom has also worked in the Developed Asia and UK Equity teams. Tom’s investment interest is focused on high-growth companies both in listed equity markets and as an investor in private companies. He graduated BSc in Computer Science with Mathematics from the University of Edinburgh in 2000.
Regulatory Information
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Baillie Gifford & Co and Baillie Gifford & Co Limited are authorised and regulated by the Financial Conduct Authority (FCA). The investment trusts managed by Baillie Gifford & Co Limited are listed on the London Stock Exchange and are not authorised or regulated by the FCA.
Baillie Gifford Asia (Hong Kong) Limited 柏基亞洲(香港)有限公司 (BGA) holds a Type 1 licence from the Securities and Futures Commission of Hong Kong to market and distribute Baillie Gifford’s range of collective investment schemes and closed-ended funds such as investment trusts to professional investors in Hong Kong.
Baillie Gifford Asia (Singapore) Private Limited (BGAS) is regulated by the Monetary Authority of Singapore as a holder of a capital markets services licence to conduct fund management activities for institutional investors and accredited investors in Singapore. BGA and BGAS are wholly owned subsidiaries of Baillie Gifford Overseas Limited, which is wholly owned by Baillie Gifford & Co.
Europe
Scottish Mortgage Investment Trust PLC (the “Company”) is an alternative investment fund for the purpose of Directive 2011/61/EU (the “AIFM Directive”). Baillie Gifford & Co Limited is the alternative investment fund manager (“AIFM”) of the Company and has been authorised for marketing to Professional Investors in this jurisdiction.
This content is made available by Baillie Gifford Investment Management (Europe) Limited (“BGE”), which has been engaged by the AIFM to carry out promotional activities relating to the Company. BGE is authorised by the Central Bank of Ireland as an AIFM under the AIFM Regulations and as a UCITS management company under the UCITS Regulation. BGE also has regulatory permissions to perform promotional, advisory and Individual Portfolio Management activities. BGE has passported its authorisations under the mechanisms set out in the AIFM Directive.
Belgium
The Company has not been and will not be registered with the Belgian Financial Services and Markets Authority (Autoriteit voor Financiële Diensten en Markten / Autorité des services et marchés financiers) (the FSMA) as a public foreign alternative collective investment scheme under Article 259 of the Belgian Law of 19 April 2014 on alternative collective investment institutions and their managers (the Law of 19 April 2014). The shares in the Company will be marketed in Belgium to professional investors within the meaning the Law of 19 April 2014 only. Any offering material relating to the offering has not been, and will not be, approved by the FSMA pursuant to the Belgian laws and regulations applicable to the public offering of securities. Accordingly, this offering as well as any documents and materials relating to the offering may not be advertised, offered or distributed in any other way, directly or indirectly, to any other person located and/or resident in Belgium other than to professional investors within the meaning the Law of 19 April 2014 and in circumstances which do not constitute an offer to the public pursuant to the Law of 19 April 2014. The shares offered by the Company shall not, whether directly or indirectly, be marketed, offered, sold, transferred or delivered in Belgium to any individual or legal entity other than to professional investors within the meaning the Law of 19 April 2014 or than to investors having a minimum investment of at least EUR 250,000 per investor.
Germany
The Trust has not offered or placed and will not offer or place or sell, directly or indirectly, units/shares to retail investors or semi-professional investors in Germany, i.e. investors which do not qualify as professional investors as defined in sec. 1 (19) no. 32 German Investment Code (Kapitalanlagegesetzbuch – KAGB) and has not distributed and will not distribute or cause to be distributed to such retail or semi-professional investor in Germany, this document or any other offering material relating to the units/shares of the Trust and that such offers, placements, sales and distributions have been and will be made in Germany only to professional investors within the meaning of sec. 1 (19) no. 32 German Investment Code (Kapitalanlagegesetzbuch – KAGB).
Luxembourg
Units/shares/interests of the Trust may only be offered or sold in the Grand Duchy of Luxembourg (Luxembourg) to professional investors within the meaning of Luxembourg act by the act of 12 July 2013 on alternative investment fund managers (the AIFM Act). This document does not constitute an offer, an invitation or a solicitation for any investment or subscription for the units/shares/interests of the Trust by retail investors in Luxembourg. Any person who is in possession of this document is hereby notified that no action has or will be taken that would allow a direct or indirect offering or placement of the units/shares/interests of the Trust to retail investors in Luxembourg.
Switzerland
The Trust has not been approved by the Swiss Financial Market Supervisory Authority (“FINMA”) for offering to non-qualified investors pursuant to Art. 120 para. 1 of the Swiss Federal Act on Collective Investment Schemes of 23 June 2006, as amended (“CISA”). Accordingly, the interests in the Trust may only be offered or advertised, and this document may only be made available, in Switzerland to qualified investors within the meaning of CISA. Investors in the Trust do not benefit from the specific investor protection provided by CISA and the supervision by the FINMA in connection with the approval for offering.
Singapore
This content has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this content and any other content or material in connection with the offer or sale, or invitation for subscription or purchase, of the Trust may not be circulated or distributed, nor may be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor (as defined in Section 4A of the Securities and Futures Act 2001, as modified or amended from time to time (SFA)) pursuant to Section 274 of the SFA, (ii) to a relevant person (as defined in Section 275(2) of the SFA) pursuant to Section 275(1), or any person pursuant to Section 275(1A), and in accordance with the conditions specified in Section 275 of the SFA, or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.
Where the Trust is subscribed or purchased under Section 275 by a relevant person which is:
(a) a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or
(b) a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary of the trust is an individual who is an accredited investor, securities or securities-based derivatives contracts (each term as defined in Section 2(1) of the SFA) of that corporation or the beneficiaries’ rights and interest (howsoever described) in that trust shall not be transferred within six months after that corporation or that trust has acquired the securities pursuant to an offer made under Section 275 except:
(1) to an institutional investor or to a relevant person or to any person arising from an offer referred to in Section 275(1A) or Section 276(4)(c)(ii) of the SFA,
(2) where no consideration is or will be given for the transfer;
(3) where the transfer is by operation of law; or
(4) pursuant to Section 276(7) of the SFA or Regulation 37A of the Securities and Futures (Offers of Investments) (Securities and Securities-based Derivatives Contracts) Regulations 2018.
