Liontrust Global Dividend Fund

  The Liontrust Global Dividend Fund continues to invest in innovative global leaders, buying companies on the right side of disruption at cyclically depressed prices ahead of a new innovation cycle.

• Q2 top contributors: Constellation Energy, Oracle, Broadcom. Detractors: Thermo Fisher, LVMH, UnitedHealth.
• Highly volatile quarter reiterates importance remaining focused on company fundamentals, which continue to accelerate for innovative companies well positioned for the new cycle
• Remain highly active, capitalising on attractive valuation opportunities to invest in innovative global leaders trading at attractive discounts

The Liontrust Global Dividend Fund returned 5.3% in June, placing it in the first quartile of peers, ahead of the IA Global Equity Income sector average return of 1.1% and the MSCI World Index return of 2.7% (both comparator benchmarks).

This rounded out the second quarter of 2025 where the Fund returned 10.1%, placing it in the first quartile of peers, ahead of the IA Global Equity Income sector average return of 2.9% and the MSCI World Index return of 5.0% (both comparator benchmarks).

Longer term performance remains strong, with the Fund having returned 130.3% since manager inception (31.08.17), the number two fund in the sector ahead of both the IA Global Equity Income sector return of 73.2% and the MSCI World Index return of 119.7%.

Fund commentary

The past few months have proved a strong reminder that in the short term, market sentiment often drives share prices, but over the longer term it is underlying fundamentals that determine investor returns.

We are now around two years into this new market cycle, characterised by both high returns and pronounced volatility. This was evident in the second quarter of 2025, with the VIX volatility index spiking to levels not seen since the GFC following April's "Liberation Day" trade policy announcements from the US which sent reverberations around global markets. Heightened uncertainty around tariffs and their potential impact on inflation and trade activity weighed on investor sentiment, the MSCI World index to falling over 9% in early April –  the 5th worst sell-off we have seen in the past 75 years.

During such sharp market sell-offs or resets, the best-performing stocks from the preceding period often suffer the steepest declines – a phenomenon we witnessed acutely in April, with a number of innovative global leaders which had led markets over prior periods selling down strongly.

Importantly, we continued to see evidence of strengthening underlying fundamentals from these companies throughout this period, as evidenced in consistently strong earnings updates and positive progress witnessed first-hand during our quarterly research trips. We are increasingly confident that the winners of this cycle will be different to those of the past, with new global leaders emerging against this volatile backdrop to position themselves on the right side of multiple innovation cycles across sectors in the years ahead.

As we noted back in April, this stark dislocation between share prices and strengthening fundamentals thus provided attractive opportunities for active managers, and we capitalised on our strict valuation discipline and active approach to reposition the portfolio during this period, including topping up companies hardest hit and adding new positions in companies which had long been on our watchlist but whose share prices had yet to provide satisfactory upside potential.

Subsequent months proved much more positive for equities as the single-biggest macro overhang weighing on markets was removed, or at least significantly reduced, following a de-escalation in trade tensions between the US and China in May. This allowed focus to shift back to underlying company fundamentals, with markets rallying through the rest of the quarter as companies continued to report strong quarterly updates. The MSCI World index rose nearly 16% from its April lows, finishing the quarter up over 5%, while the tech-heavy NASDAQ rallied nearly 25% from its April lows to finish the quarter up nearly 11%.

Notably, many of the leading global innovators that had been hardest hit during the April sell-off were among the first to see their share prices recover as broader sentiment improved, validating our active approach throughout the quarter.

Strong fundamentals

Top contributors to Fund performance during the quarter all suffered sharp sell-offs in April but subsequently rallied on the back of broader market sentiment and strong earnings updates which underscored strengthening fundamentals, global leadership positions, and accelerating innovation profiles.

For example, Constellation Energy – the top contributor to performance in the quarter – fell by over 15% in early April before shares rallied to finish the quarter to finish up 60%. The global leader in nuclear power, Constellation provided another strong update in May, delivering Q1 earnings per share (EPS) of $2.14, reaffirming full-year guidance of $8.90-$9.60, and reiterating its 13% target for average annual EPS growth through to 2030. We first invested in Constellation in early 2024 on the thesis that large-scale nuclear utilities would re-rate as demand for stable power generation becomes invaluable in the AI age. A year on, the opportunity looks even more compelling. Constellation owns the largest nuclear fleet in the US, 21GW across 23 reactors, roughly 2.5× the capacity of the next biggest operator, and supplying c.22% of all US nuclear power. That installed base is not only irreplaceable but increasingly sought after: hyperscale data centres are shifting from price to uptime, and clean baseload capacity is now mission-critical infrastructure. Upgrades are being driven by rising clean energy premiums, accelerating demand from AI workloads, and structural tailwinds from policy. The nuclear production tax credit provides downside protection and an inflation-linked floor, while the recently announced Calpine acquisition brings 26 GW of complementary natural gas assets with flexible load-balancing capability.

Critically, Constellation's strategy is already tangible: the business is signing large-scale, long-term contracts with data centre operators – notably including Microsoft, and more recently Meta – to provide clean, reliable power with fixed-price certainty over 20+ years. While volatility remains due to long-dated cash flows and macro sentiment, the investment case is clear: Constellation is building the foundational grid layer to meet surging energy demand, accelerated by AI. In a world of constrained supply, regulatory bottlenecks, and rising demand, nuclear incumbency is a structural moat. This is no longer a defensive utility. It’s a next-generation compounder, well positioned to continue its strong double-digit earnings and dividend growth trajectory in the years ahead.

Similarly, Oracle and Broadcom both saw shares fall by over 12% in April before recovering by over 50% by quarter-end, with earnings updates reinforcing the view that both of these companies have emerged as major structural winners from the AI buildout and ramping demand for both training and inference across the economy.

Broadcom delivered yet another exceptional update in June, with AI revenues accelerating to $4.4 billion – up 46% year-on-year – as the global leader in networking and custom ASIC semiconductor design continues to be at the forefront of the AI revolution. The company is scaling XPU cluster deployments at an aggressive pace to support the growing demands of hyperscaler AI infrastructure, with guidance for AI semiconductor revenue to reach $5.1 billion next quarter, a significant acceleration to 60% year-on-year growth. This momentum reflects the company's first-mover advantage in custom XPUs and AI networking solutions, with customers embarking on multi-year journeys to scale to clusters capable of supporting next-generation models and AI propagation across the economy. The company is capitalising on this advantage, with four additional hyperscaler customers "deeply engaged" in developing custom chips beyond the existing three clients (Alphabet, Meta, and ByteDance), significantly expanding the company's addressable market opportunity which is already set to reach $60-90 billion in 2027 alone – a 60% CAGR for AI revenues. The company continues to enhance its networking solutions to support high-bandwidth AI workloads, with AI networking maintaining roughly 40% of total AI revenue as increased cluster density drives continued demand for high-density, low-latency connectivity. Operating leverage continues to expand as the company scales, with record free cash flow generation positioning Broadcom well for sustained growth in the years ahead, supporting continued innovation and underpinning its impressive 13% 5-year dividend CAGR.

Meanwhile Oracle has emerged as the standout winner in cloud infrastructure for AI workloads, reporting Cloud Infrastructure revenue surging 52% year-on-year to $3 billion in its latest quarter, management projecting this to accelerate to over 70% growth in the coming year. It is becoming increasingly evident that Oracle Cloud Infrastructure (OCI) is the de facto cloud for AI workloads, with the company's technical advantages in clustering technology setting it apart from competitors. Oracle's next-gen data centres have been engineered around large GPU clusters linked with proprietary RDMA technology that disaggregates the size of data centres from server constraints – a breakthrough that enables efficient scaling of AI workloads that incumbent hyperscalers cannot match. This technological leadership is driving unprecedented demand, with CEO Larry Ellison noting they recently received an order from a client for "all available cloud capacity, wherever it is". The company's MultiCloud strategy is also gaining significant traction, with MultiCloud database revenue growing 115% quarter-over-quarter as Oracle expands its footprint across Amazon, Google, and Microsoft clouds. Significantly, the company also announced a transformational $30 billion annual revenue agreement with OpenAI in the quarter, part of the Project Stargate initiative to build massive AI data centres across the US. Under this landmark deal, OpenAI will rent 4.5GW of data centre capacity from Oracle starting in fiscal 2028, more than doubling Oracle's current cloud revenue and cementing its position as a critical infrastructure partner for the world's leading AI companies. With 70 data centres under construction and capital expenditures expected to exceed $25 billion in the coming year to meet "almost insatiable" demand, Oracle is positioning itself as not only the world's largest cloud application company but also a new leader in modern cloud infrastructure.

Beyond the AI theme, Nike – the global leader in sportswear – also contributed strongly to Fund performance, a sharp recovery from April lows seeing shares finish the quarter up 33% having fallen by over 16% early in the period. The shares jumped after a better-than-expected Q4 earnings update in late June, as the company continues its turnaround under returning CEO Elliott Hill's "Win Now" strategy. While the sportswear giant is working through a challenging period of inventory clearance and business reset, CEO Hill reassured markets declaring "the worst is behind us,” with results coming in better than feared, sales declining 12% but showing early signs that Q4 represented the trough in the company's performance. The company's order book is improving sequentially, with holiday orders up and positive early feedback from wholesale partners as the company works to improve its go-to-market. Innovation and brand health remains strong as Nike's product pipeline continues to deliver, the Vomero 18 sneaker – released in February – already a $100 million business with growth across all geographies, whilst new product launches including the A'ja Wilson collection are selling out in minutes. The company is also expanding its wholesale reach, returning to Amazon for the first time since 2019 and launching in over 200 women-led retail partners. With the company's deep IP (over 35,000 patents) supporting ongoing innovation, its dominant global scale (18% share of the global sportswear market, twice that of its closest competitor), and 23 consecutive years of dividend growth delivering a five-year dividend CAGR exceeding 10%, Nike remains well positioned to emerge stronger from this downturn as it clears outdated inventory and refocuses on high-performing categories and key geographies.

On the other hand, while market sentiment broadly recovered through the quarter, the volatile backdrop meant any miss in earnings was ultimately punished, as evidenced by key detractors to Fund performance for the quarter. While misses are of course disappointing, we were reassured to see positive signals of fundamental strength which reaffirm our conviction in these companies in the longer term.

The key detractor to performance during the quarter was United Health – a company in which we had substantially reduced our position ahead of earnings, taking profit as shares had a strong year-to-date run coming into April. This valuation discipline proved astute as shares fell after the company posted a disappointing update and guide in April largely on an unexpected jump in senior healthcare utilisation in the US, with volumes roughly doubling in physician and outpatient settings particularly for elective procedures in the public-sector Medicare Advantage group. This jump correlated with recent premium hikes, with retirees reacting by increasing utilisation of preventative care – a feeder of outpatient care. Management is assuming this elevated run-rate persists through 2026 and is embedding these assumptions into bid pricing to preserve margins. Shares fell further on confirmation of news that the DoJ was investigating the company for Medicare Fraud, though we believe that the impact of such an investigation had already largely been baked in to company dampened guide. While these developments were disappointing, we remain confident that the company’s long-term proposition remains intact, with the business model unchanged – as the largest health insurer in the US, UnitedHealth retains significant scale advantages and strategic differentiation through its vertically integrated model as payer, provider, and pharmacy benefit manager. Valuations post sell-off looked attractive, shares trading at a forward earnings multiple of c11x in mid-May – a significant discount to relative historic levels. As such, we opted top up our position following this second sell-off, a move which was rewarded as shares recovered nearly 14% by quarter-end.

LVMH was another key detractor for the quarter, shares selling off alongside luxury peers as global uncertainty weighed on consumer sentiment and spending. The company’s Q1 update disappointed as organic sales fell slightly year-on-year, and while the global leader in luxury showed pockets of resilience – including continued strength in Europe, Watches & Jewellery, and brands such as Sephora and Tiffany – this was overshadowed by persistent softness in Chinese consumer demand and a slowdown in the US which impacted sales in the group’s key Fashion & Leather Goods division. While macro conditions remain challenging, the group continues to execute well and we remain confident in LVMH’s ability to navigate the current environment. Management is responding with agility, tightening cost controls while continuing to invest in brand equity and product innovation across its global leading portfolio. As such we took the opportunity to top up throughout the quarter, confident that the group’s proven leadership and structural advantages – unparalleled scale, vertical integration, and brand desirability – will allow it to emerge stronger as consumer sentiment stabilises.

Similarly, Thermo Fisher Scientific - the global leader in life sciences tools, diagnostics, and biopharma services – saw its shares fall after the company lowered full-year profit guidance due to near-term impacts from new tariffs and US government policy changes. Management is taking swift action through pricing adjustments, cost actions, and supply chain reconfiguration –  measures it expects will largely offset the impact by next year. Importantly, underlying performance remains sound: the company modestly beat across divisions, raised its dividend (for a 15% 5-year CAGR), repurchased $2bn in shares, and continues to deploy capital into strategic M&A to round-out its portfolio. Thermo also continues to invest behind structural growth opportunities, including next-generation analytical instruments, proteomics platforms, and its integrated CDMO/CRO offering. Meanwhile, bioproduction demand continues to recover, COVID-related capacity has been successfully backfilled via fill/finish services, and management expects end-markets to return to long-term growth rates by late 2025. Thermo’s scale, decentralised structure, and deep commercial relationships provide meaningful flexibility in the face of disruption, and we retain confidence in its long-term positioning despite near-term headwinds. Nonetheless, with attractive opportunities emerging elsewhere during this period, we opted to exit our position and move it back to the watchlist where we will continue to monitor it for a more attractive entry point in the future.

We remain active

Given the backdrop we were particularly active during the quarter, taking advantage of periods of macro-driven volatility to strategically increase our positions in the hardest-hit investments across the Fund and where share-prices had most starkly disconnected from fundamentals. This included topping up our positions in aforementioned companies which ultimately ended up being top contributors to fund performance – Constellation Energy, Broadcom, and Oracle – as well as those whose price recovery we expect to play out less abruptly, including innovative global leaders within the consumer space such as L’Oreal, LVMH and Nike, and healthcare leaders such as United Health and Danaher, and Eli Lilly.

Eli Lilly – the global leader, alongside Novo Nordisk (also held), in innovative weight-loss GLP-1 drugs – posted a strong update in May, revenue and EPS both beating estimates as they grew an impressive 45% and 29% year-on-year respectively. Management did, however, trim full year EPS guidance because of a one-off charge related to the acquisition of an oral cancer programme from Scorpion Therapeutics. On the same day, CVS announced an exclusive agreement with competitor Novo Nordisk. Neither development alters our investment thesis, so we took the opportunity to top-up our position after shares fell by over 10% post-update. Today, GLP-1 penetration in obesity stands at c.1%, even though roughly two thirds of US adults are overweight or obese. The total addressable market for GLP-1s for weight loss is expected to approach US $100 billion by 2030. Over the past year Lilly has taken share and driven most of the category’s growth; losing a single distribution channel is therefore unlikely to dent momentum while the overall market is expanding so rapidly. In addition, Lilly’s direct self-pay vial strategy is gaining traction – already responsible for c25% of new US prescriptions – which sidesteps restrictive formularies and preserves margins.

Looking forward, we believe Lilly’s oral GLP 1 portfolio will be the real game changer. Orforglipron, the company’s once daily pill, delivered very positive Phase III data in type 2 diabetes, and a raft of late-stage trials is under way across indications ranging from obesity to sleep apnoea. Pipeline catalysts are plentiful in 2025, and no competitor has yet matched Lilly’s weight loss efficacy in an oral format. Pills not only eliminate needle aversion; they are easier to manufacture and require no cold chain logistics, further lowering Lilly’s cost base. With improving fundamentals, structurally underpinned earnings growth prospects, and a 5-year dividend growth CAGR of 15%, we continue to see Lilly as a truly innovative global healthcare leader, well positioned to drive strong returns ahead.

We also took the opportunity to initiate positions in a number companies on our watchlist where market volatility provided an attractive entry window, adding eight new companies to the fund in the quarter. For example, we added a position AstraZeneca back in April after US tariff speculation triggered a sharp pullback in shares, presenting an attractive entry point into a global leader in oncology, rare disease, and cardiovascular innovation with a best-in-class late-stage pipeline. Q1 results confirmed this opportunity, with strong underlying patient volume growth across key oncology assets, and impressive pipeline execution - the company securing 13 new approvals in the quarter and reporting five positive Phase 3 readouts. With ramping capacity (CAPEX to increase 50% in the year ahead to support growth) and over $10 billion in potential late-stage pipeline catalysts in 2025 alone, the company remains well positioned to drive sustained earnings growth as it continues to execute on its innovation-led strategy and scale its next wave of breakthrough medicines.

We also re-initiated a position in Intuit – the global leader in consumer and small-business financial software, with a 15% five-year dividend CAGR. Shares subsequently jumped following a strong May beat-and-raise quarterly earnings update, revenues rising 15% and EPS 18% year-on-year driven by a robust Consumer Group division where TurboTax Live saw a breakthrough 24% increase in customer adoption. With data from 100 million customers across its platform, Intuit is reaping the benefits of years of investment in AI and data management which it is using to improve operating efficiency (lifting expert filing productivity double-digits) while improving offerings for customers (tax filing times significantly reduced). This benefits the firm in a multitude of ways, such as freeing up advisor time to focus on customer onboarding, improving cross-selling opportunities, and reducing customer churn – lowering customer acquisition costs and improving cohort economics as management shifts focus to disrupting the advisor market. AI is also improving targeting, with Credit Karma revenues surging 31% year-on-year thanks to stronger credit-card and loan matching driven by the company’s AI-driven “Lightbox” engine. Elsewhere, the group’s global business solutions division continues to strengthen through accelerating product innovation – the company has seen an 8-fold increase in development velocity since 2020 – which is facilitating mid-market share gains as products such as such QuickBooks Online Advanced and Intuit Enterprise Suite resonate with customers (revenues up 40% year-on-year). As the company prepares to launch new AI agents for customer service, payments, project-management, and finance & accounting in the coming weeks, management is confident that Intuit remains well-placed to win in the era of AI-defined software which is driving enterprise software consolidation. This confidence is reflected in a raised full-year guide, management now expecting revenue growth of 15% and adjust EPS growth of 19%.

To finance these purchases, we reduced a number of holdings which performed well at different stages throughout the quarter, and exited certain companies whose upside potential was no longer sufficient. This varied month to month, but over the course of the quarter saw us trimming strong performers such as Constellation Energy and Meta, technology sector holdings such as Broadcom and Oracle, and financial sector holdings such as Morgan Stanley and Apollo Global Management. These were all companies we had topped up when they sold-off during March and April, but each of which saw strong subsequent rallies enabling us to reallocate capital to better upside opportunities elsewhere. We exited positions in a number of stocks such as the aforementioned Thermo Fisher, as well as several others which had achieved our target prices such as Micron, Lam Research, Schneider Electric, and Blackstone – each of which saw shares rally by 20-90% by quarter-end from April lows. As always, these companies move back to the watchlist where we will continue to monitor them for potential attractive entry points in the future.

Innovators remain well positioned for a new cycle

Supported by insights from recent team research trips to the US and Japan, we remain buoyed about the long-term growth prospects for innovative global leaders in the Fund, which remain well positioned for multiple new innovation cycles across different sectors in the years ahead. This was reinforced by another strong earnings season, where we have seen evidence of innovative companies proving their resilience and adaptability while strengthening their competitive positioning against a difficult market backdrop. While a degree of macroeconomic and regulatory uncertainty persists, we are reassured to see that fundamentals – rather than sentiment – will ultimately be rewarded in the market.

We look forward to sharing insights from our recent research trips in the coming weeks. With the pace of innovation accelerating, and numerous new structural growth opportunities emerging, we are seeing a lot of exciting new opportunities emerge across the industry landscape, bolstering our confidence that the winners of this new innovation cycle will be different from those of the last.

As always we will continue to maintain our valuation discipline, taking advantage of further market dislocations to invest in innovative global leaders with strong competitive barriers at attractive prices.

	Jun-25	Jun-24	Jun-23	Jun-22	Jun-21
Liontrust Global Dividend C Acc GBP	0.7%	28.9%	11.5%	-7.3%	26.5%
MSCI World	7.2%	20.9%	13.2%	-2.6%	24.4%
IA Global Equity Income	7.3%	12.8%	9.2%	1.0%	21.2%
Quartile	4	1	1	4	1