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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><strong>Laura Johnstone (LJ):</strong> Good morning, everyone, and welcome to the Baillie Gifford Long Term Global Growth second quarter update webinar, which is the first in our series. Thank you so much for your time this morning. </p>
<p>My name is Laura Johnstone, and I am part of Baillie Gifford’s US Financial Intermediaries team, and I’m based out of our New York office. I’m joined today by Diana Philip. Diana is a dedicated investment specialist on our Long Term Global Growth team, based out of our home office in Edinburgh, Scotland. </p>
<p>Diana, welcome this morning. </p>
<p><strong>Diana Philip (DP):</strong> Thank you very much, and good morning, everybody, from sunny Edinburgh.</p>
<p><strong>LJ:</strong> Lovely. Nice to hear the sun is shining in Edinburgh, which makes a change. Just some housekeeping to start. A reminder that anything we discuss in today’s webinar is based on the overall Strategy, so it may differ from the vehicle that you are invested in. </p>
<p>So, just a reminder, Long Term Global Growth is Baillie Gifford’s flagship global concentrated equity strategy. And for the past 22 years, the team has been investing in a focused portfolio of 30 to 40 companies, seeking innovative businesses with potential to deliver transformational growth over the long term. </p>
<p>Our plan today is really to touch on the investment environment, performance, any changes to the portfolio, and we will finish with overall outlook. And we really would prefer this to be as interactive as possible, so please do submit your questions throughout the chat, and I’ll keep an eye on these and hope to get to all of them. </p>
<p>So, Diana, why don’t we turn it over to you? Why don’t we start with market backdrop? It was another positive quarter for global equities, but there were several notable themes shaping markets. From the team’s perspective, what stood out over the past quarter?</p>
<p><strong>DP: </strong>Thank you, Laura. Yes, you’re absolutely right, it was a positive quarter for global equities. The market was up about 15 percent over the period, so it rallied really strongly. But I think that what is interesting to note is just how narrow that rally was. It was carried by a very, very small number of stocks. And mostly, it was those companies that are benefiting from this huge spending that we’ve seen play out in AI infrastructure over the recent past. </p>
<p>Just to demonstrate how narrow the rally was, there was this extraordinary stat that I saw that for the first six months of the year, about 99 percent of the return of the NASDAQ 100 came from just ten companies. And these were all semiconductor-related companies. And this is a dynamic that we’ve very much seen play out in other markets, too, in the recent past. </p>
<p>Now, I think that it’s important to remind ourselves, and you touched on this at the beginning, that LTGG has a five- to ten-year investment horizon. So we are not trying to manage the portfolio to the quarterly or daily beat of the market. We’re trying to identify and own the few companies that really make a difference to returns over this long-term investment horizon. </p>
<p>So we are not trying, therefore, to own every single AI beneficiary. We’re looking to identify and own the companies that have really durable competitive advantages, the ones that are capable of generating superior returns through the cycle. Now, that does mean that sometimes we will miss parts of a rally if today’s elevated demand might not translate into that lasting advantage that we seek in LTGG. </p>
<p><strong>LJ:</strong> That’s very useful background, Diana, thank you. If we then turn to performance, the portfolio delivered a positive absolute return, but lagged the benchmark over the quarter. Can you walk us through the key drivers of performance and, maybe more importantly, how the team is thinking about these businesses today? </p>
<p><strong>DP: </strong>Yes, absolutely. As you say, we delivered a positive absolute return, but we did lag this extraordinarily strong market over the quarter. Now, this is unusual, and I think that it’s unpacking the reasons behind this. And there’s several that I’ll explain to listeners. </p>
<p>The first, really, is related to the narrowness of the market. Now, rather than owning the memory, the optics and the CPU names that have dominated returns of the market so far this year, we have very much stayed focused on the companies that are occupying genuine technical bottlenecks, not these temporary pinch points. </p>
<p>And our holdings in NVIDIA, in TSMC and in ASML are the clearest examples of what we are doing in LTGG. Together, they account for about 21 percent of the portfolio today. And each of these companies controls what is really a very critical and very difficult to replicate part of the semiconductor ecosystem. And we believe that each is very well placed to benefit as AI continues to evolve. </p>
<p>The second dynamic that we’ve seen this quarter, and we’ve seen in recent quarters too, is this growing disconnect between share prices and business fundamentals. And this was a dynamic that we saw in a number of holdings over the last quarter. </p>
<p>And to bring this to life, I think that the battery manufacturer, CATL, is a very good example. It really continues to strengthen its technological lead in next-generation battery chemistries. And also, it strengthened its competitive position in global energy storage. But its shares have de-rated, and we have viewed this very much opportunistically, and we’ve added to the holding over the course of the last quarter. </p>
<p>The other dynamic which I think is worth bringing to light is that – again, we’ve seen this over the years managing LTGG – is that markets do tend to have a tendency to react very quickly if growth slows or if companies are sacrificing near-term profitability to invest for their future. That is exactly what we want our companies to do. We want to see them investing in their competitive advantages. </p>
<p>Now, this is a dynamic, again, that has affected a number of holdings this quarter. And to bring that to life, I think that MercadoLibre is a really good example. Management has deliberately been trading near-term margins for long-term growth. It’s been investing in logistics. It’s been investing in payments and fulfilment. Now, its share price has weakened as a result of this investment, but we’re seeing revenue growth is accelerating to almost 50 percent, and volumes and unit economics continue to improve. We believe that those are the metrics that matter far more for the long-term investment case, and we continue to view companies such as that with high conviction. </p>
<p><strong>LJ:</strong> That’s extremely helpful. Why don’t we move on to some new ideas for the portfolio over the last quarter? And I think one of the most notable changes was the addition of SpaceX. And this is a business that Baillie Gifford knows very well through our Private Companies team, with their first investment back in 2018 when it was a $30bn company. It would just be really interesting, Diana, to hear what gave the team conviction to initiate a position after its IPO. </p>
<p><strong>DP:</strong> Yes. Well, you’re right to bring up SpaceX, but I don’t want to forget our other new holding, which is QXO…</p>
<p><strong>LJ: </strong>Yes. </p>
<p><strong>DP:</strong> That we took a position in this quarter. But maybe we can bring up the slide which shows a little bit of background to the new positions that we’ve taken this quarter. And you’re right, SpaceX has been held privately at Baillie Gifford since 2018. Now, that institutional knowledge has been really invaluable in helping us to understand the company, particularly as it’s transitioning to a listed business. </p>
<p>Now, for SpaceX, what really excites us about the company isn’t simply rockets. It’s the fact that it is reducing the cost of accessing space. Now, why is it doing this? It is a vertically integrated company. So, it designs and it manufactures almost everything itself, which allows it to innovate faster and bring launch costs down dramatically. </p>
<p>Now, this is important because lower launch costs create this really powerful flywheel. More launches generate more data, more data improves the technology, and that further reduces costs. And every reduction in cost really creates new markets, from satellite connectivity to defense, to, potentially, AI infrastructure in the future. </p>
<p>And ultimately, for Long Term Global Growth, we really believe that SpaceX has the potential to become this critical infrastructure for communications, for defense, for logistics, AI potentially, and it’s really laying the foundations for the type of outlier that we seek to own within the portfolio. So, that’s one example of a new purchase this quarter. </p>
<p>And then a very, very different business is QXO, which is the other holding that we’ve taken a position in over the period. Now, it’s very different. It is a really ambitious industrial roll-up, essentially, and it’s led by founder Brad Jacobs. He has already founded eight different billion-dollar companies, and QXO is his ninth. And he is applying his playbook of buy, integrate and tech-enable to the vast building supplies industry. Now, this is an industry which is about $800bn across North America and Europe, but it’s exceptionally fragmented, and it has outdated systems. And by outdated, I’m talking about faxes. I’m talking about human memory. Less than 20 percent of transactions occur online. </p>
<p>Now, these are very, very different new holdings for the portfolio, different business models. But it’s worth remembering that they share the characteristics that we are looking for in LTGG: ambitious leadership, durable competitive advantages, and really this potential to become exceptional long-term outliers. </p>
<p><strong>LJ:</strong> Thanks, Diana. Two very different businesses there, but just shows that diverse opportunity set, that’s very interesting. </p>
<p>Maybe we could take a little step back and look at a number of the companies that we hold continue to actually execute very well operationally, yet that progress hasn’t always been reflected in the share price. From the team’s perspective, how do you then distinguish between that short-term market sentiment and then genuine changes to the company’s long-term investment case – which is, of course, what we’re trying to do at Baillie Gifford? </p>
<p><strong>DP: </strong>Yes. Our ten-question research framework is an incredibly helpful barometer of the underlying strength of the companies in the portfolio. Now, as a reminder, this research framework has been in place since the inception of the Strategy 22 years ago. And it’s a list of ten questions that we look to address before taking any new holding in the portfolio, but it’s also a very helpful framework for assessing existing portfolio companies to ensure that they still merit a place in our concentrated portfolio of outlier growth companies. </p>
<p>We have been revisiting the ten-question frameworks for a number of portfolio holdings in recent months, and that has led to some portfolio changes. For example, it’s led us to exit some of our software-related names. Recently, we exited our holding in Atlassian, for example, and we exited Datadog and Workday earlier in 2025, where we believe the underlying environment and advancing AI has the ability or the potential to compromise their long-term competitive advantages. </p>
<p>But going through and revisiting the ten-question framework has also led us to add to several companies in the portfolio where we’re seeing this disconnect between share prices and their fundamentals. And as a result of that, we’ve been adding to the likes of Axon, Samsara and Adyen, where we’re seeing this increasing disconnect, where share prices really aren’t reflecting the underlying strength of their operating fundamentals.</p>
<p>And I think that it’s maybe worth just highlighting at a portfolio level, and I think we’ve got a slide to show the portfolio fundamentals, how strong these are. This is a portfolio whose fundamentals continue to strengthen. </p>
<p>Now, we know that superior revenue and earnings growth drive share prices over the long term, and you can see from the left-hand side that our holdings are accelerating faster than the market. But these are also companies which are self-financing; 94 percent of the portfolio today are either earnings- or free cash flow-positive. This self-financing allows adaptability. They're also companies which are investing in their future, and they’re investing in their future at a rate that is double than that of the market. So this backdrop gives us extreme, significant optimism in the underlying strength of the portfolio going forward. </p>
<p><strong>LJ: </strong>Thanks, Diana. Those graphs are very useful to bring it to life.</p>
<p>Just conscious of time – and please do submit any questions before we finish, I’ll have a look and make sure, if there’s any coming through. But maybe just looking ahead, as you look across the portfolio today, what excites you most about the opportunity set, and what gives you confidence in the Strategy’s positioning over the next five to ten years? </p>
<p><strong>DP: </strong>Yes. I’m going to keep this brief, and I’m going to keep it to two points. I’ve talked about the narrowness of the market. What excites us is we’ve been casting the net really widely for new ideas. And we can do that because we are completely unconstrained by the shackles of an index or a benchmark. We do not need to manage the portfolio relative to any index or benchmark weightings, and throwing away those shackles means that we have the opportunity to cast our net much, much wider. </p>
<p>Now, that’s reflected in the new holdings that we’ve discussed, SpaceX and QXO, two very, very different businesses. But I also reflect on our stock discussions of late, which have covered companies as broad as healthcare, defense, miners, to name but a few new ideas. </p>
<p>But I think that what really gives us so much optimism looking forward, is that we are now looking at a portfolio whose annual free cash flow growth has more than doubled over the past decade to, about 35 percent today. Yet, following this underperformance, which we’ve discussed, the valuation that our clients are paying for that growth has fallen dramatically, and forward valuation premia are now at decade lows. And for the first time in LTGG’s history, the portfolio now trades at a lower price-to-free-cash-flow multiple than the index itself. </p>
<p>Now, to us, that really is a remarkable combination: stronger underlying growth, much broader opportunity, and more attractive valuations than we’ve seen for many, many years. Today really does feel like one of those once-in-a-generation dislocations that presents a hugely compelling opportunity for us, and for long-term investors. </p>
<p><strong>LJ: </strong>A very positive note to end on, thank you, Diana. I don’t see any other questions come through, so happy to leave it there for today. But really appreciate everyone joining us today. Grateful for your continued support and welcome any feedback you may have. </p>
<p>Just before we finish up, I wanted to draw your attention to some related insights available. They should be showing on your right hand of your screen now. We’ve included a link to the LTGG ETF landing page, as well as the team’s thoughts on the new buys this quarter, as Diana mentioned: SpaceX and QXO. </p>
<p>And as a reminder, this webinar is part of our quarterly series, so we’d be delighted if you could join us for our remaining sessions that continue this week and then on to next. The schedule should be appearing right now on the screen, with the next being International Alpha tomorrow at 11am Eastern Time. </p>
<p>As always, if you have any questions following today’s webinar, please do get in touch with your relationship manager, and we’d be very happy to help. </p>
<p>Thank you again, Diana, and have a fantastic summer.</p>
<p> </p>
<h3 class="TABLEHEADER1212pt">Long Term Global Growth</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: 74.6668px;">
<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: 41.2174%;"> </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: 11.8696%;"><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: 11.7391%;"><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: 11.7391%;"><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: 11.7391%;"><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: 11.7391%;"><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: 41.2174%;">Long Term Global Growth Composite (gross)</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.8696%;">-48.6</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.7391%;">25.0</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.7391%;">22.2</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.7391%;">27.4</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.7391%;">-6.0</td>
</tr>
<tr style="height: 18.6667px;">
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 41.2174%;">Long Term Global Growth Composite (net)</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.8696%;">-48.9</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.7391%;">24.2</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.7391%;">21.4</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.7391%;">26.5</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.7391%;">-6.7</td>
</tr>
<tr style="height: 18.6667px;">
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 41.2174%;">MSCI ACWI Index</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.8696%;">-15.4</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.7391%;">17.1</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.7391%;">19.9</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.7391%;">16.7</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.5px; text-align: right; width: 11.7391%;">24.2</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: 93.3334px;">
<tbody>
<tr style="height: 37.3333px;">
<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: 37.3333px; width: 43.8662%;"> </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: 37.3333px; width: 12.6394%; 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: 37.3333px; width: 12.2677%; 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: 37.3333px; width: 12.269%; text-align: right;"><strong>10 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; width: 18.9577%; text-align: right;"><strong>Since inception*</strong></td>
</tr>
<tr style="height: 18.6667px;">
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 43.8662%;">Long Term Global Growth Composite (gross)</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 12.6394%; text-align: right;">-6.0</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 12.2677%; text-align: right;">-1.2</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 12.269%; text-align: right;">16.4</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; width: 18.9577%; text-align: right;">12.6</td>
</tr>
<tr style="height: 18.6667px;">
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 43.8662%;">Long Term Global Growth Composite (net)</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 12.6394%; text-align: right;">-6.7</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 12.2677%; text-align: right;">-1.9</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 12.269%; text-align: right;">15.6</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; width: 18.9577%; text-align: right;">11.8</td>
</tr>
<tr style="height: 18.6667px;">
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 43.8662%;">MSCI ACWI Index</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 12.6394%; text-align: right;">24.2</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 12.2677%; text-align: right;">11.5</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; height: 18.6667px; width: 12.269%; text-align: right;">13.3</td>
<td style="border: 1px solid rgb(204, 204, 204); padding: 10px; width: 18.9577%; text-align: right;">9.4</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. *29 February 2004.</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>
<p>Baillie Gifford Overseas Limited provides investment management and advisory services to non-UK Professional/Institutional clients only. Baillie Gifford Overseas Limited is wholly owned by Baillie Gifford & Co. Baillie Gifford & Co and Baillie Gifford Overseas Limited are authorised and regulated by the FCA in the UK. </p>
<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">202505 10064477</span><span class="source-text"></span></p>
