Baron Technology Fund

NVIDIA Corporation (NVDA) sells semiconductors, systems, and software for accelerated computing, gaming, and generative AI (GenAI).
Computing demand has been doubling every one to two years, driven by electrification, digitization and the recent advancements in AI, yet supply growth has decelerated dramatically due to the slowdown in Moore's law. NVIDIA’s accelerated computing architecture enables continued growth in supply of computing through parallelization. We are at the tipping point of a new era in computing with NVIDIA at its epicenter as GenAI adoption grows. Given its leading market share in gaming, data centers, and autonomous machines, we believe NVIDIA can grow rapidly for years to come.

Amazon.com, Inc. (AMZN) is an e-commerce pioneer, innovator, and market share leader with a relentless focus on providing value and convenience to its customers. Amazon also operates the industry-leading cloud infrastructure business Amazon Web Services.
Amazon's market share of U.S. online retail sales is around 40%, while its share of global online retail sales is less than 5%. Amazon has many avenues for revenue growth, including consumer staples, apparel, international expansion, digital media offerings, private label, pharmacy services, advertising, and a better shopping experience powered by generative AI. With Amazon Web Services as a large, growing part of the business, we also believe Amazon represents a unique opportunity to invest in the secular growth of cloud computing.

Microsoft Corporation (MSFT) is a software company traditionally known for its Windows and Office products. Over the last five years, it has built a $120 billion-plus annual cloud business, including Office 365, CRM product Dynamics 365, and infrastructure-as-a-service product Azure.
Microsoft is led by Satya Nadella, who has refocused the company on cloud computing and AI. He has been quite successful thus far, with Microsoft's commercial cloud business now representing over 56% of revenue and growing around 25% year-on-year. Microsoft's moat is based on the wide reach of its sales channel, its diverse platform of software offerings, hybrid cloud capabilities, and the high costs of switching away from its solutions, which tend to be critical for its customers. We believe Microsoft will benefit from the growing adoption of cloud for years to come.

Apple Inc. (AAPL) designs, manufactures, and markets consumer electronics, computer software, and online services. Its products include the iPhone, iPad, Mac personal computer, Apple smartwatch, Apple TV, and HomePod. It also offers advertising and app discovery services through its App Store.
As the creator and owner of one of the largest and most popular consumer electronics platforms, Apple, in our view, is well positioned to benefit from the network effect that typically accrues to platform companies. It has a large and growing ecosystem, a trusted brand, and positive optionality through its efforts to expand into additional consumer and enterprise services with its large installed base. We believe Apple trades at a discount to our estimate of its intrinsic value, with capital return and growth alleviating near-term trade and iPhone demand uncertainty. 

Broadcom Inc. (AVGO) designs, develops, and supplies a wide range of semiconductor and infrastructure software solutions. Its semiconductor devices serve broadband, networking, wireless, storage, and industrial markets while its software offerings focus on operational efficiency tools for large enterprises.
Broadcom’s semiconductor portfolio is reaching an inflection point, driven by its AI solutions in networking and custom compute. The rest of its semis portfolio should grow at mid-single digits, while its legacy software offerings should grow at low-single digits as the company focuses on cost efficiencies, cross-selling, and servicing key enterprise accounts. We think recent acquisition VMWare will grow faster post-purchase due to Broadcom's product simplification and SaaS conversion strategy. Broadcom has strong margins and cash flow, which it returns to shareholders.

Spotify Technology S.A. (SPOT) is the world's leading music streaming service, with approximately 40% market share. The company monetizes through subscriptions, advertising, and miscellaneous a la carte pricing.
With over 239 million paying subscribers, Spotify has created a two-sided marketplace where creators can monetize their work and consumers can stream music. Longer term, we expect the company to grow to over one billion total subscribers (from 615 million today) and improve margins materially through advertising, its artist promotions marketplace, and improved cost discipline. On the product side, we expect Spotify to continually improve its value proposition through additional features and expansion into adjacencies such as audiobooks.

Taiwan Semiconductor Manufacturing Company Limited (TSM) is the world's largest independent semiconductor foundry, manufacturing chips on behalf of other companies.
Taiwan Semi (TSMC) remains the dominant force in leading edge semiconductor foundry manufacturing, as it benefits from economies of scale and a superior cost structure. Its successful track record of deploying new technology faster than competitors enables it to maintain its market share and pricing power. We believe TSMC’s investments in advanced nodes will solidify its superior market positioning and profitability in the long run.

CoStar Group, Inc. (CSGP) is the leading provider of information and marketing services to the commercial real estate industry.
CoStar has built a proprietary database through data collection over a 20-year period, creating high barriers to entry. We think CoStar's suite should grow at mid-teens rates, and we believe its Loopnet marketing platform can grow even faster. Its Apartments.com platform is the dominant multi-family internet listing service and should grow revenue by more than 20%. CoStar is starting to expand into residential, creating additional significant growth opportunities. Its balance sheet and cash generation create M&A optionality.

Tesla, Inc. (TSLA) manufactures electric vehicles, including a luxury sedan and CUV (S/X), a mid-sized luxury sedan and hatchback (3/Y), and pickup and semi-trucks. It is also ramping up internal battery cell production, energy solutions, and software offerings such as full self-driving and insurance.
We expect Tesla will continue to grow its automotive business rapidly through international production capacity and product expansion. We believe Tesla's vertical integration, technology innovation, brand, profitability, and growing supplier support offer unique and durable growth opportunities that are hard to replicate. In addition, Tesla's energy and software expertise is broadening the industrial opportunity to large and profitable revenue avenues that were previously locked in the legacy vehicle architecture, such as autonomous, insurance, and other AI use cases.

Duolingo, Inc.

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