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<p><strong>Your capital is at risk. Past performance is not a guide to future returns.</strong></p>
<p class="MsoNormal"> </p>
<p class="MsoNormal"><strong>Kristen Ross (KR): </strong>Good morning, everybody. Welcome to the Baillie Gifford Emerging Markets Q2 update webinar. My name is Kristen Ross. I'm a member of the US Financial Institutions Group covering the southeast intermediaries. I'm pleased to be joined today by Amy Leishman, one of the investment specialists on our Emerging Markets team.</p>
<p class="MsoNormal">Before we start, just want to share a quick reminder that Baillie Gifford has been investing across emerging market equities since 1994, and today we manage just north of $30bn on behalf of our clients across the asset class. The Emerging Markets All Cap Strategy is one of our longest-standing portfolios and takes a diversified approach to investing in what we believe are some of the best companies in the asset class.</p>
<p class="MsoNormal">Before we turn the conversation over today to the performance for the past quarter, I want to share a really exciting milestone for Baillie Gifford. In June, we launched four active ETFs. The Emerging Markets Strategy is, we're delighted to share, one of those four strategies, and that Strategy’s ticker is BGEG. For those who want to learn more about the ETF at the end of this call, we'd be very happy to put you in touch with your client contact.</p>
<p class="MsoNormal">So, let me lay out the agenda for today. Over the next 20 minutes, Amy and I are prepared to touch on four topics. The first will cover what happened in markets over the last quarter, followed by how the portfolio performed, what the team's been thinking about and acting on, and we'll finish with why we continue to believe the opportunity in emerging markets is more compelling than the headlines might suggest.</p>
<p class="MsoNormal">We do like to keep the conversation very interactive. We've intentionally left slides off for today's dialogue, so do feel free - there's a chat box for you all down at the bottom of your screen, I'll be monitoring that throughout, very happy to field any comments or questions.</p>
<p class="MsoNormal">So, Amy, let's begin. Let's start with a little bit of a market backdrop. It seems we can't get away from South Korea over the last 12-plus months. The last time we spoke, memory names were leading the market and had been extraordinarily strong. What's been happening since?</p>
<p class="MsoNormal"><strong>Amy Leishman (AL): </strong>Yes, well, hi, everybody. And thanks, Kristen.</p>
<p class="MsoNormal">It's largely been a continuation of the same, to be honest. Really, the story of the quarter has been the ongoing strength of anything connected to AI infrastructure, and in particular, the South Korean memory chip makers. So, we have seen the shares pull back this month in the likes of Samsung and SK Hynix. But notwithstanding those drawdowns over the last 12 months, Samsung is up about 200 percent, and SK Hynix is up over 500 percent. That's largely been driven by the exceptional earnings that these companies have been delivering. So, if I was to put some numbers on it, Samsung's operating profit is expected to rise more than six times this year to around US$185bn. And that's larger than every one of the magnificent seven, obviously with the exception of NVIDIA.</p>
<p class="MsoNormal"><strong>KR: </strong>Yeah, that's truly incredible, some of those numbers. And they've added quite a bit of value for our clients over the last year or so. And that's because we've held them with conviction and size. But given some of the moves, I think it'd be helpful for those on the line to understand how the team's thinking about the names from this point forward.</p>
<p class="MsoNormal"><strong>AL:</strong> Yes, so it's a very fair question. There's really two sides to this. On the one hand, we're still overweight these names, and that's a very deliberate decision. If this is a once-in-a-generation emerging markets super-cycle driven by strong AI demand, then we want our clients to have meaningful exposure to it.</p>
<p class="MsoNormal">But on the other hand, over the time that we've owned these companies, some of which has been over two decades, nearly three, we've been through multiple semiconductor cycles before. I think it was about seven the last time I counted. And the one thing that they've taught us is that the memory industry is cyclical. So, our starting position is that we're not betting the house on the cycle never turning. What we are doing is taking part in the upside, participating in the upside, while actively trimming and taking profits along the way.</p>
<p class="MsoNormal"><strong>KR:</strong> Maybe it's worth explaining what gives the team conviction that we are in an EM super-cycle. And then equally, what signals are the team watching?</p>
<p class="MsoNormal"><strong>AL:</strong> Yes, sure. So again, there are really two ways to think about this. You can think about it through the demand side and through the supply side.</p>
<p class="MsoNormal">On demand, there are really three points. The first is the sheer quantity of memory per AI chip that's exploding. If you look at NVIDIA's GB200 chip, it requires about 13 terabytes of memory, whereas the next generation, the Vero Rubin Ultra, requires about 150 terabytes. That's roughly an 11x increase in memory. So even before you add a single new data center, each one needs far more memory than the last.</p>
<p class="MsoNormal">The second point on demand, which is an area that we think is more underappreciated, is that the most advanced memory is becoming increasingly customized. So, the chip at the base of each memory stack is starting to be co-designed with the customer. That makes the product less interchangeable, it gives it longer development cycles, and also lets it attract higher prices. So, more of the advanced memory is starting to look less commodity-like and more bespoke.</p>
<p class="MsoNormal">And then, the third point on demand is that customer behavior is changing around the edges. Memory has traditionally been priced on a quarter-to-quarter basis, but now some of it is being locked in on three- to five-year agreements. They include price floors, volume commitments, and even prepayments in some circumstances. And that is a bit of a step-change from previous cycles. I would say, though, that it's only a portion, not the whole, but it's an interesting development.</p>
<p class="MsoNormal">And so, I said the demand side, but then also on the supply side, I think it's really helpful to remember just how we got here. Two or three years ago, memory was in a deep down-cycle. Certain memory products, NAND, for example, were loss-making, even though we only have a few producers. And back then, no one was in a position to expand because of that. So capex got cut, and that meant we've basically walked into a period of genuine underinvestment, right as the likes of agentic AI requires more memory, edge AI becomes more important, or as the robotics industry continues to develop.</p>
<p class="MsoNormal">So, I suppose if I were to summarize, demand remains strong, parts of the memory stack are becoming higher quality, and a bit less purely cyclical, and capacity looks like it could stay constrained for longer than the market's pricing in.</p>
<p class="MsoNormal"><strong>KR:</strong> Helpful. And for balance, what about the signals the team are watching?</p>
<p class="MsoNormal"><strong>AL: </strong>Yes, of course. I mean, as with any investment case, there are risks. So what we're watching, both on the demand and the supply side, are a number of different factors. That includes watching US hyperscalers, capex plans, it includes Chinese spending and competition through companies such as CXMT in China, the actual pace of supply-side capacity expansion, including equipment players and orders that are coming through there. We're also speaking to leading semiconductor research institutes, as well as many other industry experts.</p>
<p class="MsoNormal">So, ultimately, when you're thinking about the signals, and what could go wrong, there's a lot of different points that we are triangulating to aid our thinking here. And clearly, we are prepared to change as the facts change. But the part that does keep us comfortable holding an overweight, which we do in this portfolio at this point, is that even with all the share price improvements that we've seen over the last year, we are still being asked to pay very little for the possibility that this cycle is bigger and longer than usual. And you're being asked to pay almost nothing for the improvement in some of the businesses themselves. I'm thinking Samsung's foundry business, in particular. And I suppose that's the kind of asymmetry that we're happy to own, but very much with our eyes wide open.</p>
<p class="MsoNormal"><strong>KR:</strong> I suppose it's helpful that you've known these companies for quite some time, isn't it?</p>
<p class="MsoNormal"><strong>AL:</strong> Yes, true. So, we first owned Samsung back in the 1990s, and SK Hynix in the early 2000s. We've been researching them for a very long time, met with them many times over the years as well. It means that we've been there when sentiment has been very strong, but equally when it's been terrible.</p>
<p class="MsoNormal">I think that's really an important point to remember, the cycle does cut both ways and we're very alive to that. I remember only a year or so ago, the team making the case for Samsung, which had been a top detractor for a number of quarters. The market was pessimistic about its foundry business, the challenges that it had qualifying with NVIDIA on the latest advanced memory chips. And if we had listened to the narrative back then and moved on, that would have been a terrible decision for clients.</p>
<p class="MsoNormal">But ultimately, what the team did then, as we are doing now, is going back to fundamentals, retesting our conviction, and acting on that.</p>
<p class="MsoNormal"><strong>KR: </strong>Yes, if I'm recalling, during that period of weakness for Samsung, the team added to the name, didn't they?</p>
<p class="MsoNormal"><strong>AL:</strong> Yes, I believe we did for Samsung. So really, trimming on strength. We've been trimming at the start of this year and adding on weakness where the fundamentals are still strong.</p>
<p class="MsoNormal"><strong>KR: </strong>Great. Amy, you shared that you were in Taiwan and South Korea early in this year. Is it safe to assume that you were meeting with the likes of Samsung and Hynix?</p>
<p class="MsoNormal"><strong>AL: </strong>Yes, we met with both Samsung and SK Hynix, as well as TSMC, which is another large position in the portfolio. We also met with over 20 other companies across the AI supply chain. We've actually had others in the team that were out again to South Korea and Taiwan this quarter. So, we've met our large holdings a number of times already this year.</p>
<p class="MsoNormal"><strong>KR: </strong>Excellent. And what were some of the key takeaways?</p>
<p class="MsoNormal"><strong>AL:</strong> Honestly, what struck us most was how conservative management teams remain on capacity. We're seeing large capex plans being announced, but we also heard directly from them that there's a stronger focus on profitability and sustainability, today. There isn't a desire to repeat the same industry dynamics that we saw with the last downturn.</p>
<p class="MsoNormal"><strong>KR: </strong>Great. Seeing some questions pop in here, let me take one of them. Let's see, we've had a question from the audience on how you weigh the concentration risks in the benchmark, given the rise in semi and AI exposure that we've been speaking about versus the domestic EM opportunity.</p>
<p class="MsoNormal"><strong>AL: </strong>Yes, it's a good question. So thank you very much for asking it. It's definitely front-of-mind for everybody right now. Taiwan and South Korea are now over about 50 percent of the MSCI EM index. So, firstly, if you own a passive EM fund today, you are actually buying a very large concentrated bet, largely on one theme, whether you mean to or not.</p>
<p class="MsoNormal">But for us, the honest answer is that concentration isn't something that you can just fix with one lever. It's something that we have to actively manage by making sure that the portfolio has lots of different ways to win.</p>
<p class="MsoNormal">And so, maybe thinking about it in two parts. First, we have to be very deliberate about the big names. So, our positions in the likes of Samsung, TSMC, SK Hynix, those are the result of bottom-up work on each business, rather than the benchmark telling us what we should hold. And as I said, we've been actively trimming those into strength, rather than letting them run unchecked. And then secondly, we also have to be deliberate about where those proceeds go. Our risk team has done a lot of work on correlation analysis. That's really so that we genuinely understand which parts of the portfolio behave differently from the AI complex, and we've largely been recycling into those areas. That includes the domestic sides of EM, so the likes of Chinese consumer platform businesses, Latin American real assets, and so on.</p>
<p class="MsoNormal">I said two points, but maybe I'll actually add a third, because I think the part I would really emphasize when it comes to index concentration, because it's one of the most powerful answers, is that you have to look beyond the index. Around 15 percent of our fund is in companies that the benchmark doesn't represent at all, but where we still see strong future earnings growth that we don't think the market has cottoned onto yet.</p>
<p class="MsoNormal"><strong>KR:</strong> Yeah, I mean, the index concentration is striking, and I would say it's one of the questions we get quite regularly when we're out in the field. Can you give us an example of a name that's not representative of the benchmark?</p>
<p class="MsoNormal"><strong>AL: </strong>Yes, so Mobile World is a good example. It's a Vietnamese retailer, and it gives us exposure to Vietnam's young, increasingly affluent consumer, and also a retail market that is still moving from informal to formal channels in an economy that is just growing much quicker than many others in the region. And so, that's a company that we think can compound earnings for decades that sits well outside the benchmark's narrow center of gravity.</p>
<p class="MsoNormal">I'd maybe just sum up how we're thinking about index concentration, because firstly, we're very conscious of that concentration, but we're not just managing it by owning less of the big stuff. We're actively building a portfolio with genuinely independent drivers of return, so that no single theme, however exciting, decides the outcome for clients. I'm just realizing that my light's gone off as well, but hopefully you can all still see me and hear me.</p>
<p class="MsoNormal"><strong>KR: </strong>Great. Let's stick on that theme – areas that are less correlated with the AI names. China is one of those, isn't it? Can you talk us through what the team's thinking about China right now, and what you've been doing there?</p>
<p class="MsoNormal"><strong>AL: </strong>Yes, exactly. So, the correlation analysis that I mentioned, and through that analysis, China was actually one of the areas that had the lowest correlations to the big AI names. If you think about it, and coming back to concentration, it's almost like there's been a beam of light on emerging markets right now, which is very bright, but very narrow, and it's obviously solely focused on Taiwan and Korea. But the trouble with a bright narrow beam means that everything outside is easy to miss. And given where valuations are, China clearly still sits outside.</p>
<p class="MsoNormal">We genuinely find that odd for a number of reasons. Firstly, China is the world's dominant supplier of a lot of the things that the AI builder actually needs. With the exception of advanced semiconductor chips, you still need batteries, power equipment, materials, various different components, and actually, a lot of that does come from China. It's also building a globally competitive AI ecosystem – under very different constraints from the US, yes, but also with very different advantages, most notably access to power.</p>
<p class="MsoNormal">And then, again, coming back to index concentration, China has breadth. Tech is about 70 percent of the Korean index. It's around 90 percent of Taiwan's, but it's only around 20 percent of China All Shares. So, China has consumer platforms, healthcare, insurance, industrial supply chains. It's really one of the few large liquid places to find growth that isn't AI-dominated.</p>
<p class="MsoNormal"><strong>KR: </strong>That's exciting, really robust opportunity. Maybe give us a sense for a flavor of what we've been buying there.</p>
<p class="MsoNormal"><strong>AL: </strong>The largest addition that we made over the quarter in China has been to our CATL position. As a reminder, it's the world's largest battery maker. It's supplying some of the biggest EV brands, including Tesla, Xiaomi, NIO, and its profits now exceed those of China's seven largest car makers combined. I think that tells you something about where value in the auto chain has migrated. At its last results, net profits rose by about over 55 percent despite intensifying competition and rising costs, yet it remains on a low double-digit multiple.</p>
<p class="MsoNormal">We've also added across the spread of smaller positions, including Pony AI, an autonomous driving company, Didi, a ride-hailing business that's also operating in Latin America, and B1, which is now focused on becoming a global oncology business, not just China alone.</p>
<p class="MsoNormal"><strong>KR:</strong> That's nice, a real mix of different opportunities across industries. What about the macro situation? I mean, it's been five years now, there's been no shortage of headlines Things have been challenged. Are we seeing the signs that things are getting better?</p>
<p class="MsoNormal"><strong>AL: </strong>Yes, there are certainly challenges on the macro front for China, which is why we remain selective. We're not making a blanket call from a top-down perspective. Our additions are driven by bottom-up conviction.</p>
<p class="MsoNormal">But I suppose there are tentative signs on the positive side, though. It really comes back to property. Most Chinese household wealth is tied up in housing. So, when prices fall, people feel poorer. They spend less. That's the wealth effect, and it's been negative. And for the last five years or so, because it's been negative, it's worked against China as a persistent drag.</p>
<p class="MsoNormal">But we are now seeing third-party researchers saying that 2026 could be the first year since 2021 that that wealth effect actually flips positive. So, prices stabling, households feeling wealthier again, and ultimately that should support spending rather than suppressing it.</p>
<p class="MsoNormal">Now, we're obviously not hanging our hat on all of that. But we do think it's a more important signal than month-to-month retail sales figures that most China commentary fixates on. And if it's even roughly right, it should be supportive for consumption and a tailwind for a number of our domestic holdings.</p>
<p class="MsoNormal">The point I would make, though, is that when the starting valuations are as low as we're seeing, you really don't need heroic assumptions. The situation can just be fine and you can still do very well.</p>
<p class="MsoNormal"><strong>KR: </strong>Great, helpful context and maybe worth flagging, although we haven't added to it this quarter – is it worth saying a few words on Tencent given the recent share price weakness?</p>
<p class="MsoNormal"><strong>AL: </strong>Yes, good point. Tencent shares have been weak, and it's been one of the top detractors to performance. But at the operational level, we believe it's actually strengthening. You know, it's been labelled as too slow on the AI front because it's not developed a frontier LLM like others have, Alibaba, etc. But we actually think the more relevant question for Tencent is, what AI does for the businesses that already make money, the businesses that already exist?</p>
<p class="MsoNormal">Tencent has the WeChat super-app, which is a platform that has around 1.3, 1.4 billion users, some of which open it anywhere from 5 to 50 times a day. And it now has an opportunity to embed an AI agent within that platform, making the whole ecosystem more valuable.</p>
<p class="MsoNormal">It's also got opportunities in its gaming business, they're particularly exciting. So, you used to have to spend millions of dollars to build games in the past, hiring thousands of graphic designers, engineers… Light’s come back on. But now AI makes developing games much cheaper, and it also means that they can tailor games to individual players, and ultimately, that increases the time spent on the platform.</p>
<p class="MsoNormal">So, actually, when you think about Tencent, I think they really sit in one of the underappreciated areas of the AI thematic – it's companies that can use AI to structurally benefit their existing businesses.</p>
<p class="MsoNormal"><strong>KR: </strong>We won't take that sign of the lights coming back on as shining a light on Tencent.</p>
<p class="MsoNormal">Let's move the conversation to another area the team's been leaning into: real assets, commodities, infrastructure. What are you all thinking there?</p>
<p class="MsoNormal"><strong>AL:</strong> Yes, the starting point is that we are now likely in a world that is seeing more persistent inflationary pressure than we've perhaps become accustomed to in the past. And at the same time, you're also seeing energy security and national infrastructure moving up government agendas. So, with that backdrop, really we want exposure to real assets that can benefit in that environment. That includes copper, lithium, platinum as well. They're all metals and minerals that the world needs more of while supply remains constrained in a number of areas.</p>
<p class="MsoNormal">So over the quarter, we also added Brazilian iron ore to that mix, and that was through our purchase of Vale. Iron ore is really key for making steel, and the market's been weak due to the Chinese property pullback that we saw over the last few years. But actually, we think the medium-term demand is much broader and more resilient than what is currently priced in – whether that's grid upgrades, data centers, transport, pipelines, manufacturing, they all require steel. And Vale gives us access to the Carajás iron ore system in Brazil through what is one of the world's lowest-cost and highest-quality diversified miners.</p>
<p class="MsoNormal"><strong>KR:</strong> Great. So, these positions, we talk a lot about the barbell and the portfolio. One side, you've got the AI, the fast-growing tech names, and then the other side, you've got the commodities, the underlying raw materials, helpful in providing a balanced and diversified portfolio. Walk me through the barbell, what areas might I be missing?</p>
<p class="MsoNormal"><strong>AL: </strong>Yes, that's completely right. AI hardware on the one side, kind of real assets, commodities on the other. I suppose what I would add is exposure to the large domestic consumer opportunities in the middle. That really goes back to the EM domestic exposure point that we spoke about a moment ago. Obviously, when you look at performance recently, one barbell, or one part or one end of that barbell, has done very well, the semiconductor AI hardware. But that means that we have a lot of firing power in the other parts of the barbell that haven't done as well.</p>
<p class="MsoNormal"><strong>KR:</strong> Yes, you talked a little bit about the Tencent recent share price weakness. Let's take a look at some of the detractors for the quarter.</p>
<p class="MsoNormal"><strong>AL:</strong> So, it's really been our ecommerce and our internet platform holdings, as well as some of the positions in Brazil linked to oil, and those ones are fairly self-explanatory given the oil price moves. When we come back to the ecommerce companies, the likes of MercadoLibre, for example, what's been frustrating is that operational performance has still been very strong there. MercadoLibre's revenue was up 49 percent year-over-year. Their new users are up over 20 percent year-over-year. The amount bought and sold on their platforms, so GMV, keeps growing. It was up at 40 percent, as well as the amount of payment volumes on the fintech side, which were up about 50 percent as well.</p>
<p class="MsoNormal">But the challenge that they've had has been margin compression. And that's really because they've continued to build out their logistics network, so committed around US$11bn dollars of investment to their Brazilian operations, which includes opening 14 fulfillment distribution centers in the country, taking them to a grand total of over 40. And really, the market hasn't taken kindly to that. But for us, we're comfortable holding through short-term compression, because over the long term, the investments that MercadoLibre is making today should mean that even more parcels can be delivered in a shorter space of time. So, in other words, in our view, they're actually strengthening their competitive advantage.</p>
<p class="MsoNormal">We did meet with MercadoLibre's Brazilian CEO when we were out in the country earlier in the year. What the team took away from that was reassurance that they remain on track, that they're being rational about competition, and also how they're thinking about how they embed agentic AI in a way that adds value for their customers. So they're really thinking forward.</p>
<p class="MsoNormal"><strong>KR: </strong>Thanks, Amy. That's helpful. Are there any areas the team has lost conviction on and moved on from?</p>
<p class="MsoNormal"><strong>AL:</strong> We fully exited a handful of holdings over the quarter. That included an Indian IT services company, a Thai bank, a gold miner, and an Indian car maker. And really, in each case, it was largely down to our insight no longer being meaningfully different from the markets, or just better opportunities and risk reward elsewhere in the portfolio. So, these were all small positions and, ultimately, we just wanted to put capital to work elsewhere.</p>
<p class="MsoNormal"><strong>KR: </strong>Great. A couple of minutes left. I see a couple of questions that have since come in. Let's bring this home. Let's zoom out the lens. We get this all the time in our conversations recently with clients and prospects, given the strong run that we've seen: folks are worried that the best is behind us. Make the case for us. Why is now still a time to be adding rather than taking money off the table?</p>
<p class="MsoNormal"><strong>AL:</strong> Great question, good question. So, I understand the instinct, but I would argue that this is the wrong moment to be reducing. I'd point first to what we're seeing from the bottom up in the portfolio, because obviously that's where we spend most of our time. <br>So, firstly, the fundamental strength that's coming through from our holdings is, if anything, building. One-year-forward earnings estimates are running at around 43 percent ahead of an index that's roughly 36 percent. The same pattern plays out on three-year forward earnings as well.</p>
<p class="MsoNormal">And then on an aggregate level, the portfolio is higher-quality than the index, whether that's higher gross margins, operating margins, higher ROE, stronger balance sheets, and also it's genuinely differentiated, so both from the benchmark but also actually when you look at the peer set, as well. And all of that is on a valuation multiple that's now lower than the index. So, ultimately, you're getting faster growth, higher quality, and real differentiation without having to pay a premium for it.</p>
<p class="MsoNormal">But then, secondly, just to finish, that portfolio sits within an asset class that is also undervalued. Emerging markets is still at roughly a 30-35 percent discount to developed markets, but growing much faster. At a time when we're talking about concentration, everyone's asking about it, it's rising up on everyone's agenda, you could argue that the more important concentration question to ask is whether it's right that the US is the biggest portion of the ACWI when emerging markets is growing nearly twice as fast at a much lower price. So, you know, when we take all of that together, I would strongly argue that emerging markets is closer to the beginning of something rather than closer to the end.</p>
<p class="MsoNormal"><strong>KR:</strong> That's great. Thanks, Amy. That's probably a natural place to end the conversation.</p>
<p class="MsoNormal">Let's shift. We have a couple of questions that’ve come in. The first is centered around Russian equities. So, does EM currently hold any Russian equities, even though it may have been written off to zero? I heard that BG recently sold some of your EM Russian equities. Is that correct?</p>
<p class="MsoNormal"><strong>AL: </strong>We can certainly provide some additional detail on the specifics of them. We do still have a couple of Russian holdings that were written down to zero. And of course, that's something that we're looking into in terms of whether we can sell and the value that we can add, and that will be a case-by-case point. But if you do need any further detail on the specifics, we can certainly get in touch.</p>
<p class="MsoNormal"><strong>KR:</strong> Thanks, Amy. Yes, we're happy to, we'll follow up off this call. We can get you in touch with your client contact to give you more context there.</p>
<p class="MsoNormal">One last question that has come in: How have you thought about the incentive of high memory costs to bring on new supply from new players, earning names like Samsung and SK Hynix?</p>
<p class="MsoNormal"><strong>AL:</strong> How have we said, sorry, can we just repeat that?</p>
<p class="MsoNormal"><strong>KR:</strong> How have we thought about the incentive of high memory costs to bring on new supply from new players, earning names like Samsung and SK?</p>
<p class="MsoNormal"><strong>AL: </strong>So, I suppose this would really be thinking about the Chinese space – the likes of a CXMT – because obviously, you know, the age-old “there's no solution for high prices than high prices”. What we are hearing is that when we're speaking to the likes of an IMEC, which is one of the leading research providers for the semiconductor industry, that over the next five-plus years, DRAM and NAND are the key memory technologies. And really only Samsung, SK Hynix and Micron can do that at the moment. China is still a couple of years behind. But we are, of course, continuing to watch where prices go. We're continuing to watch the capex plans, because ultimately, if capex does come in, does flood the market, then that challenges prices. So it's one of the many different factors that we're factoring in.</p>
<p class="MsoNormal"><strong>KR: </strong>Thanks, Amy. I don't see any other questions at this time. We are at our half hour, so I will end the conversation here. Thanks so much for joining us, everyone. We have one of our webinar series left for the quarter. That is tomorrow morning. It's our International Concentrated Growth Strategy.</p>
<p class="MsoNormal">For anyone who wants more information on the active ETF I mentioned at the start of this call, very happy to put you in touch with your client contact or any other outstanding questions. Happy to assist however we can. Thank you all for joining and enjoy the rest of your summer.</p>
<p class="MsoNormal"> </p>
<h3 class="TABLEHEADER1212pt">Emerging Markets</h3>
<p><strong>Annual past performance to 30 June each year (%)</strong></p>
<table border="1" style="border-collapse: collapse; width: 100%; border-width: 0px; height: 112px;">
<tbody>
<tr style="height: 18.6667px;">
<td style="border-width: 1px 1px 2px; border-style: solid; border-color: rgb(204, 204, 204) rgb(204, 204, 204) rgb(0, 0, 0); border-image: initial; padding: 10px; height: 18.6667px; width: 60.3913%;"> </td>
<td style="border-width: 1px 1px 2px; border-style: solid; border-color: rgb(204, 204, 204) rgb(204, 204, 204) rgb(0, 0, 0); border-image: initial; padding: 10px; height: 18.6667px; text-align: right; width: 8.21739%;"><strong>2022</strong></td>
<td style="border-width: 1px 1px 2px; border-style: solid; border-color: rgb(204, 204, 204) rgb(204, 204, 204) rgb(0, 0, 0); border-image: initial; padding: 10px; height: 18.6667px; text-align: right; width: 7.95652%;"><strong>2023</strong></td>
<td style="border-width: 1px 1px 2px; border-style: solid; border-color: rgb(204, 204, 204) rgb(204, 204, 204) rgb(0, 0, 0); border-image: initial; padding: 10px; height: 18.6667px; text-align: right; width: 7.82609%;"><strong>2024</strong></td>
<td style="border-width: 1px 1px 2px; border-style: solid; border-color: rgb(204, 204, 204) rgb(204, 204, 204) rgb(0, 0, 0); border-image: initial; padding: 10px; height: 18.6667px; text-align: right; width: 7.82609%;"><strong>2025</strong></td>
<td style="border-width: 1px 1px 2px; border-style: solid; border-color: rgb(204, 204, 204) rgb(204, 204, 204) rgb(0, 0, 0); border-image: initial; padding: 10px; height: 18.6667px; text-align: right; width: 7.69565%;"><strong>2026</strong></td>
</tr>
<tr style="height: 18.6667px;">
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 60.3913%;">Emerging Markets All Cap Composite (gross)</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 8.21739%;">-35.4</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 7.95652%;">9.4</td>
<td style="border: 1px solid rgb(204, 204, 204); padding-top: 10px; padding-right: 10px; padding-bottom: 10px; height: 19.2593px; text-align: right; width: 7.82609%;">15.3</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 7.82609%;">12.7</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 7.69565%;">53.7</td>
</tr>
<tr style="height: 18.6667px;">
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 60.3913%;">Emerging Markets All Cap Composite (net)</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 8.21739%;">-35.9</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 7.95652%;">8.6</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 7.82609%;">14.4</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 7.82609%;">11.8</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 7.69565%;">52.5</td>
</tr>
<tr style="height: 18.6667px;">
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 60.3913%;">MSCI Emerging Markets Index</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 8.21739%;">-25.0</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 7.95652%;">2.2</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 7.82609%;">13.0</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 7.82609%;">16.0</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; text-align: right; width: 7.69565%;">44.2</td>
</tr>
</tbody>
</table>
<p><strong>Annualised returns to 30 June 2026 (%)</strong></p>
<table border="1" style="border-collapse: collapse; width: 100%; border-width: 0px; height: 93.0001px;">
<tbody>
<tr style="height: 37px;">
<td style="border-width: 1px 1px 2px; border-style: solid; border-color: rgb(204, 204, 204) rgb(204, 204, 204) rgb(0, 0, 0); border-image: initial; padding: 10px; height: 37px; width: 61.4348%;"> </td>
<td style="border-width: 1px 1px 2px; border-style: solid; border-color: rgb(204, 204, 204) rgb(204, 204, 204) rgb(0, 0, 0); border-image: initial; padding: 10px; height: 37px; width: 13.0435%; text-align: right;"><strong>1 year</strong></td>
<td style="border-width: 1px 1px 2px; border-style: solid; border-color: rgb(204, 204, 204) rgb(204, 204, 204) rgb(0, 0, 0); border-image: initial; padding: 10px; height: 37px; width: 12.6522%; text-align: right;"><strong>5 years</strong></td>
<td style="border-width: 1px 1px 2px; border-style: solid; border-color: rgb(204, 204, 204) rgb(204, 204, 204) rgb(0, 0, 0); border-image: initial; padding: 10px; height: 37px; width: 12.7826%; text-align: right;"><strong>10 years</strong></td>
</tr>
<tr style="height: 18.6667px;">
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 61.4348%;">Emerging Markets All Cap Composite (gross)</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; width: 13.0435%; text-align: right;">53.7</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; width: 12.6522%; text-align: right;">7.1</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; width: 12.7826%; text-align: right;">13.6</td>
</tr>
<tr style="height: 18.6667px;">
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 61.4348%;">Emerging Markets All Cap Composite (net)</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; width: 13.0435%; text-align: right;">52.5</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; width: 12.6522%; text-align: right;">6.3</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; width: 12.7826%; text-align: right;">12.7</td>
</tr>
<tr style="height: 18.6667px;">
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 61.4348%;">MSCI Emerging Markets Index</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; width: 13.0435%; text-align: right;">44.2</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; width: 12.6522%; text-align: right;">7.7</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 19.2593px; width: 12.7826%; text-align: right;">10.5</td>
</tr>
</tbody>
</table>
<p><span class="source-text"><strong>Source:</strong> Revolution, MSCI. US dollars. Net returns have been calculated by reducing the gross return by the highest annual management fee for the composite. 1 year figures are not annualised.</span></p>
<p><strong>Past performance is not a guide to future returns.</strong></p>
<p><span class="source-text">Legal notice: MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indexes or any securities or financial products. This report is not approved, endorsed, reviewed or produced by MSCI. None of the MSCI data is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such.</span></p>
<h3>Risk factors</h3>
<p>This communication was produced and approved in July 2026 and has not been updated subsequently. It represents views held at the time and may not reflect current thinking.</p>
<p>The views expressed should not be considered as advice or a recommendation to buy, sell or hold a particular investment. They reflect opinion and should not be taken as statements of fact nor should any reliance be placed on them when making investment decisions.</p>
<p>This communication contains information on investments which does not constitute independent research. Accordingly, it is not subject to the protections afforded to independent research, but is classified as advertising under Art 68 of the Financial Services Act (‘FinSA’) and Baillie Gifford and its staff may have dealt in the investments concerned.</p>
<p>All information is sourced from Baillie Gifford & Co and is current unless otherwise stated. </p>
<p>The images used in this communication are for illustrative purposes only.</p>
<h3>Important information</h3>
<p>Baillie Gifford & Co and Baillie Gifford & Co Limited are authorised and regulated by the Financial Conduct Authority (FCA). Baillie Gifford & Co Limited is an Authorised Corporate Director of OEICs.</p>
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<p>Persons resident or domiciled outside the UK should consult with their professional advisers as to whether they require any governmental or other consents in order to enable them to invest, and with their tax advisers for advice relevant to their own particular circumstances.</p>
<p><strong>Financial intermediaries</strong></p>
<p>This communication is suitable for use of financial intermediaries. Financial intermediaries are solely responsible for any further distribution and Baillie Gifford takes no responsibility for the reliance on this document by any other person who did not receive this document directly from Baillie Gifford.</p>
<p> </p>
<p><span class="source-text">202713 10064482</span><span class="source-text"></span></p>
