The Infusive Consumer Global Alpha Leaders Fund delivered +0.54% net of fees in May, bringing YTD performance to -0.58% for the USD Class A. Additional UCITS documents are available at **https://infusive.com/ucits**.
The geographical mix of the portfolio remains tilted towards North America, with meaningful exposure to Western Europe and Asia Pacific. We held approximately 5% cash.
The top contributors in May were Apple, Microsoft, Tesla, Spotify, and Adidas. The bottom contributors were Walmart, Tesco, Costco, Shopify, and Lowe’s.
May was a month defined by two competing forces: AI monetisation becoming visible on income statements rather than in analyst narratives, and a market increasingly discriminating between businesses that grow through genuine customer loyalty and those that grow through volume and price. The portfolio’s weighting towards the former drove the month’s contributors; the latter explains where we gave ground. The majority of market returns YTD have been concentrated in a small segment of AI, semiconductor, energy and infrastructure companies.
1. Technology — from narrative to revenue line
The contribution from Apple, Microsoft, and Tesla reflects something we have been tracking closely: the consumer technology complex is beginning to demonstrate that AI investment is not simply a cost story — it is becoming a revenue story. Apple’s ecosystem stickiness and services growth continue to reward patience. Microsoft’s enterprise and consumer AI integrations are translating into pricing power that few would have modelled even twelve months ago, with a growing pipeline of new products. Tesla, despite the noise that perennially surrounds it, showed that brand conviction among its core customer base remains robust, but it is the opportunities in robotics that we believe could create an enormous new consumer category.
Spotify’s contribution is particularly instructive. The platform continues to demonstrate that a consumer who is deeply embedded in a product — through habit, personalisation, and switching cost — is a fundamentally different asset to own than one acquired through promotion. Pricing increases that would have historically triggered churn have largely held. Whilst the share price has been volatile, we believe Spotify is an underappreciated compounder within the consumer space.
Adidas rounds out the top contributors. Its recovery continues to confirm a thesis we hold broadly: brand rehabilitation, when driven by genuine product relevance rather than promotional recovery, tends to be both durable and margin-accretive. The consumer’s appetite for quality in footwear and apparel — a category where identity and utility intersect — remains robust.
2. Retail and home improvement — navigating a deliberate consumer
The month’s detractors were concentrated in large-format retail and home improvement. Walmart, Tesco, and Costco are category-defining businesses with distribution advantages that are genuinely difficult to replicate. But May was unforgiving of any hint of volume softness in staples, and the market’s reaction reflects a real question: in an environment where the consumer is allocating rather than spending broadly, how does the earnings trajectory look for businesses where volume is the primary driver of operating leverage? We do not think that question changes our long-term view of these franchises, but it is a fair one for the near term, and the share prices reflected it. We used weakness to add to high conviction positions.
3. What we are watching — the application of innovation and technology in consumer businesses
An area of specific focus for the team has been assessing where the economic value from AI adoption is likely to accrue. The so-called ‘Software Apocalypse’ has led to a significant derating across large parts of the software and broader technology complex, while capital has rotated toward a narrow cohort of highly visible, hyper-growth AI platforms approaching the public markets. These businesses have dominated the narrative; however, many of the companies presumed to be at risk of disruption are, in practice, integrating AI through strategic partnerships with these emerging leaders or embedding AI capabilities directly into their own technology stacks.
In our view, this is beginning to reveal a more nuanced opportunity set. Well-positioned franchises with durable distribution, large installed customer bases, and elevated switching costs are using AI to improve throughput, enhance product functionality, and deepen customer engagement, rather than seeing their economics structurally impaired. As this dynamic evolves, the locus of competitive advantage may shift from pure product differentiation toward the combination of advantaged distribution and AI-enabled service delivery. We do not believe the market is currently attributing sufficient value to select franchises with dominant market share positions, meaningful embedded customer value, and clear scope to enhance that value proposition further through AI
4. Consumer Positioning
The consumer, in aggregate, continues to spend — but the quality of that spending is what separates portfolio winners from laggards. The market response to this is often rapid and savage. We observe a K-shaped dynamic that is becoming increasingly difficult to ignore: the upper cohort is spending with confidence, anchored by wealth effects and AI-driven optimism; the lower cohort is under genuine pressure from sticky prices and a mixed labour market. For a fund of our construction — focused on global consumer leaders with pricing power, loyal customer bases, and distribution advantages — this environment is navigable and creates opportunity, but it requires discipline. The businesses we own are not immune to cycles, but they are built to endure them.
Regards,
Infusive Asset Management Team