Core Insights - Baron Fifth Avenue Growth Fund gained 5.7% in Q3 2025, underperforming the Russell 1000 Growth Index (10.5%) and the S&P 500 Index (8.1%) [2] - Year-to-date, the Fund is up 14.4%, compared to 17.2% and 14.8% for its benchmarks [2] Top Contributors to Performance - NVIDIA Corporation's shares rose 18.1% due to its strong position in AI infrastructure, with a long-term total addressable market (TAM) expansion from $1 trillion to between $3 and $4 trillion [3] - Shopify Inc. saw a 28.6% increase in shares, driven by a 30% year-over-year revenue growth and a 29% increase in gross merchandise volume (GMV) [4][5] - Tesla, Inc. shares increased by 40.0%, supported by record delivery volumes, renewed investor confidence in leadership, and advancements in AI initiatives [6] Top Detractors from Performance - The Trade Desk's shares declined 31.9% due to in-line earnings and competitive pressures, particularly from Amazon's entry into the market [7] - Intuitive Surgical, Inc. shares fell 17.7% as system placements in the U.S. did not meet expectations, compounded by financial pressures on hospital customers [8] - MercadoLibre, Inc. shares decreased by 10.6% due to macroeconomic pressures in Argentina and increased competition from Amazon, despite strong quarterly results [9] Recent Activity - The Fund initiated a small investment in Figma and added to existing holdings in KKR, Alphabet, Taiwan Semiconductor, and CrowdStrike, funded by reducing positions in seven other holdings [10]

Core Insights - Microsoft aims to primarily utilize its own chips in data centers to reduce dependence on Nvidia and AMD [1][6] - The company has been developing custom chips for AI workloads, including the Azure Maia AI Accelerator and Cobalt CPU [5] - Microsoft is focused on optimizing the entire system design, including networks and cooling, to enhance performance for specific workloads [7] Chip Strategy - Microsoft currently relies on Nvidia and AMD for chip supply, prioritizing the best price-performance ratio [3][4] - The long-term strategy involves increasing the use of Microsoft-designed silicon in data centers [6] - The company is exploring next-generation semiconductor products to further its chip development efforts [5] Industry Context - Nvidia has been the dominant player in the semiconductor space for AI applications, while AMD holds a smaller market share [2] - Major cloud computing companies, including Microsoft, Google, and Amazon, are designing their own chips to enhance efficiency and reduce reliance on external suppliers [7]