Sands Capital Management, LLC‘s Technology Innovators Fund released its Q4 2025 investor letter for “Technology Innovators Fund”. A copy of the letter can be downloaded here. The Fund delivered mixed performance during the fourth quarter of 2025, as market returns were increasingly driven by a narrow group of large-cap growth stocks, with the portfolio’s top ten holdings accounting for roughly 59% of assets, while several high-valuation innovation names faced pressure from slowing momentum and investor risk aversion. The fund’s results reflected stock-specific challenges rather than broad macroeconomic shocks, with weaker performance in certain emerging technology holdings offset by strength in select platform and infrastructure businesses. During the quarter, the portfolio declined 6.3% on a quarter-to-date basis, and the fund generated a 14.7% return over the one year, reflecting stock-specific challenges rather than broad macroeconomic shocks, with weaker performance in certain emerging technology holdings offset by strength in select platform and infrastructure businesses. Management emphasized its long-term investment horizon, noting an average annual portfolio turnover of 21%, and stated that many portfolio companies continued to generate solid full-year earnings growth in 2025, supported by durable revenue models tied to artificial intelligence, cloud computing, and digital transformation, even as enthusiasm for speculative growth faded late in the quarter. In addition, please check the Fund’s top five holdings to know its best picks in 2025.
In its fourth-quarter 2025 investor letter, Sands Capital Technology Innovators Fund highlighted stocks like Microsoft Corporation (NASDAQ:MSFT). Microsoft Corporation (NASDAQ:MSFT) is a global technology leader driven by its Azure cloud platform, enterprise software dominance, and expanding artificial intelligence capabilities. The one-month return of Microsoft Corporation (NASDAQ:MSFT) was -21.24% while its shares traded between $344.79 and $555.45 over the last 52 weeks. On February 13, 2026, Microsoft Corporation (NASDAQ:MSFT) stock closed at approximately $401.84 per share, with a market capitalization of about $2.99 trillion.
Sands Capital Technology Innovators Fund stated the following regarding Microsoft Corporation (NASDAQ:MSFT) in its Q4 2025 investor letter:
“Microsoft Corporation (NASDAQ:MSFT) shares declined after the company reported its third-quarter results. Azure, its cloud services business, grew revenue by 39 percent year over year, exceeding management’s guidance. However, investor expectations were likely higher, particularly in comparison to recent reacceleration trends at other cloud providers. Growth remains limited by capacity constraints rather than demand across all workloads, which may have dampened the market’s enthusiasm. Microsoft plans to increase its AI capacity by 80 percent through June 2026, a move that reflects strong underlying demand. We believe this investment could help alleviate the current bottlenecks and support a reacceleration of growth in the coming quarters. This expansion also reinforces our view of Microsoft’s positioning for sustained above-average growth as AI adoption broadens across industries.”
Microsoft Corporation (NASDAQ:MSFT) is in 2nd position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 312 hedge fund portfolios held Microsoft Corporation (NASDAQ:MSFT) at the end of the third quarter, which was 294 in the previous quarter. While we acknowledge the risk and potential of Microsoft Corporation (NASDAQ:MSFT) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Microsoft Corporation (NASDAQ:MSFT) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Microsoft Corporation (NASDAQ:MSFT) and shared the list of the most profitable mega cap stocks to buy. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
