Changes to the Portfolio, and further results

All Newsletters6 May 2026

“When the facts change, I change my mind. What do you do, sir?” John Maynard Keynes

A material change in our Portfolio

The current portfolio is shown below. We have made material changes.

NVDA is still our biggest position and we still believe that the stock will see $500 in 3 years time, but the next 3 months may see Vera Rubin delays and further losses in Market Share that we have already anticipated. NVDA had the opportunity with Vera Rubin to grasp the CPU market but by over specification to the Vera Rubin racks, they have dropped the ball through delays. It is a set back that we believe will be overcome but it gives AMD and ARM some space to run. More on this matter can be read in the section about AMD results below.

Interestingly, when we produced our full model in the last Newsletter one eagle eyed shareholder pointed out that Morgan Stanley are now forecasting Hyperscaler Capex spend in 2027 of $1.1trn which is now HIGHER than our model forecast of $1trn. Note this is the first time any broker has punched in with a forecast higher than ours and we would note that when we first published these forecasts many people said we were deranged. This is why we retain a high level of confidence that NVDA can hit our $500 target price but some painful patience may well be required.

Our Portfolio is now more diversified. We have positions in Memory, CPUs, GPUs, TPUs, Optics, Networking, Ai Model Labs, Semi Fabrication, Semi Equipment, Energy, Power & Cooling, Financial Applications, Neo-Clouds, Robotics, and Space.

BUT we also but we remain big bulls of NVDA on a 3 year view, but NVDA must escalate and accelerate their Share Buy Backs in H2 2026. Results are forthcoming in the middle of May. We are data dependent, and will flex accordingly post the input of further data.

The changing Geo-economic landscape with China’s forthcoming Service surplus

This article is highly recommended.

It details how China will use Agentic Ai to lower its manufacturing cost base even lower AND create a material surplus in China’s Services Account. This will change Geo-economic and Financial Markets materially and could cause havoc with YOUR portfolio.

The conclusions to the article are hard hitting:

The Equity Market looking forward

Some further great work from Yardeni Research:

“Before the Age of AI, economists were taught that there are only three factors of production, namely, Land, Labor, and Capital. The job of economists is to optimize the allocation of these scarce resources to maximize output (i.e., real GDP). Now, economists should recognize that there is a fourth factor of production, namely, Data. This resource is unlimited. But until AI, it wasn’t very useful because it was very expensive to collect, process, and analyze.

The Digital Revolution increases the incentive to create more Data (a.k.a. Information), especially now that AI tools can process so much more of it, increasing its value as a factor of production by boosting productivity. This is the story we’ve often told before, and it is the story the stock market is now discounting, especially in semiconductor stocks in general and in memory stocks in particular (chart).

All the data increases the demand for “compute.” It further increases the demand for memory because all data must be stored indefinitely unless it is voluntarily deleted. This is our Buzz Lightyear Theory (BLT) of AI, which is taking the Data Revolution “to infinity and beyond.” That’s even more exciting and bullish than our Roaring 2020s scenario.”

That chart is a cracker especially for those that tell you that the current Capex Boom is a temporary bubble. Like so many things in Technology Investing, the history has not been studied by most investors, just the specialists. Are you sure you have enough of your portfolio focused on this LONG TERM trend?

MORE Q1 2026 Results round up for Portfolio Holdings

AMD Q1 2026 Earnings Call — Key Management Quotes

Headline Results

  • Su on the quarter: “We delivered an outstanding start to the year, driven by accelerating demand for AI infrastructure across our portfolio. Growth was broad-based with every segment increasing year-over-year, led by 57% data center revenue growth.”
  • Su on the inflection: “These results mark a clear inflection in our growth trajectory and a structural shift in our business. Data center is now the primary driver of our revenue and earnings growth.”
  • Hu on operating leverage: “Diluted earnings per share was $1.37, up 43% year-over-year, underscoring the significant operating leverage in our model as we scale.”

Data Center & EPYC Server CPUs

  • Su on cloud + enterprise growth: “Revenue increased more than 50% year-over-year with sales to both cloud and enterprise customers each growing more than 50%.” [Enterprise growth again!]
  • Su on Q2 server outlook: “We now expect server CPU revenue to grow by more than 70% year-over-year in the second quarter, with robust growth continuing through the second half of 2026 and into 2027.”

Server CPU TAM Upgrade

  • Su on the new TAM: “Based on the demand signals we are seeing today and the structural increase in CPU compute requirements, driven by agentic AI, we now expect the server CPU TAM to grow at greater than 35% annually, reaching over a $120 billion by 2030.” [WOW!]
  • Su on AI driving CPU demand: “Inferencing and agentic AI are increasing the need for server CPU compute, as these workloads require additional CPU processing for orchestration, data movement, and parallel execution, in addition to serving as the head nodes for GPUs and accelerators.”
  • Su on TAM being additive: “It’s largely additive to the TAM. So, you should think about, we need all of the accelerators to run these foundational models. And then as these agents do work, they spawn more CPU tasks.” [So NVDA get to party too!]
  • Su on CPU:GPU ratios shifting: “In the past, the CPU to GPU ratio was primarily just as a host node in like a 1 to 4 or 1 to 8 configuration. Now changing and getting closer to a 1 to 1 configuration or you can even imagine if you get lots and lots of agents that you could have more CPUs and GPUs.”

Venice / Next-Gen EPYC

  • Su on competitive performance: “Venice widens our competitive advantage, delivering substantially higher performance per socket and per watt versus competitive x86 offerings, and more than 2x throughput per socket versus leading ARM-based AI solutions.” [AMD > ARM]

Instinct GPUs & Helios

  • Su on MI450 demand exceeding plan: “As we approach production, demand for MI450 Series GPUs continues to strengthen, with lead customer forecasts now exceeding our initial plans and a growing number of new customers engaging on large-scale deployments, including additional multi-gigawatt opportunities.”
  • Su on 2027 visibility: “We have strong and increasing confidence in our ability to deliver tens of billions of dollars in annual data center AI revenue in 2027 and to exceed our long-term growth target of greater than 80% in the coming years.”
  • Su on Helios ramp profile: “We will be ramping Helios in the second half of the year. So, let’s call it starting with initial volume in Q3 with a significant ramp in Q4 and then continuing to ramp in Q1.”

Competition

  • Su on portfolio strategy: “You’re going to need a broad portfolio of CPUs, like not all CPUs are the same. Frankly, you’re going to need different CPUs for whether you’re talking about general purpose operations or you’re talking about head nodes or you’re talking about agentic AI tasks.” [We have been saying this for awhile on all Chip types.]
  • Su on TAM expansion: “The key is that TAM is much, much larger than anybody thought. And so there’s a lot of opportunity for different products to be successful in this area.”

ROCm & Software

  • Su on software progress: “We continue to make strong progress with ROCm, improving performance, scalability, and enabling customers to reach production faster. In our latest MLPerf results, MI355X delivered strong competitive performance across the full suite, with leadership results in multiple categories.”

Long-Term Framing

  • Su on the early innings: “While we are still in the early stages of the AI infrastructure cycle, the pace and scale of deployments we’re seeing today reinforce both the magnitude and durability of the opportunity ahead.”
  • Su on AMD’s positioning: “AMD is uniquely positioned to lead in this next phase of AI, with leadership products across high performance service CPUs and AI accelerators, and the ability to optimize them together as fully integrated rack-scale solutions.”
  • Su on EPS target: “We see a clear path to exceed our long-term financial targets, including delivering more than $20 in EPS over the strategic timeframe.”

Lumentum Q3 FY2026 Earnings Call — Key Quotes

Headline Results

  • Hurlston on the quarter: “Lumentum delivered an exceptional third quarter with revenue growing 90% year-over-year to a record $808 million. Top-line growth was primarily driven by our transceiver business and laser chips.”
  • Hurlston on margin expansion: “While revenue-growth was impressive, our non-GAAP operating-margin was more so, expanding by over 2,100 basis points year-over-year, fueled by a rich product mix and strong operating-leverage.“

$2bn Quarterly Target

  • Hurlston on the $2bn target: “Our largest single growth driver, scale-up CPO, is still very much in its infancy. Taken together, this gives us confidence that we are very much on track to reach our $2 billion quarterly revenue goal as we articulated at our OFC events.”

Supply-Demand Imbalance

  • Hurlston on EML imbalance: “We continue to lag demand. The supply-demand imbalance is probably even higher than we reported in our last call, somewhere greater than 30%. I think last time we gave a metric of 25% to 30%.”

EML & Laser Chips

  • Hurlston on growth trajectory: “We ship twice the number of laser chips as we did in the same quarter last year, and we are on track to achieve more than 50% growth in EML units by the December quarter of 2026, as compared to the December quarter of 2025.”
  • Hurlston on Japan fab: “Our wafer capacity, wafer fab capacity in Japan, remains at a premium and is fully allocated to meet surging customer demand.”

Scale-Across Components (Pump Lasers, Narrow Linewidth, WSS)

  • Hurlston on shipment growth: “Shipments of our narrow line with the laser assemblies grew for the ninth consecutive quarter, rising over 120% year-over-year, while pump laser shipments grew 80% year-over-year.”
  • Hurlston on hyperscaler architecture shift: “As hyperscalers exhaust the power and space limits of individual data center buildings, they are shifting to distributed architectures that link commute domains across disparate geographies. These scale-across networks require high-bandwidth synchronization across multiple data centers.”

CPO (Co-Packaged Optics) & Greensboro Fab

  • Hurlston on scale-up CPO TAM: “We will have a massive supply-demand imbalance on CPO. It’s going to be very, very significant… We expect the scale-up to be significantly more than that in terms of revenue opportunity. I think it’s going to be somewhere greater than $5 billion of incremental revenue that we can add if we execute properly.”
  • Hurlston on Greensboro timing: “The Greensboro fab is not going to come online until 2028. So, we’ve sort of set expectation that it’s sort of in the early 2028 line.”
  • Hurlston on ELS opportunity: “On ELS, we definitely have a very significant opportunity... we believe that we can integrate up and take more of the dollars by generating a vertically integrated ELS, and I think as we engage on CPO we’re finding that to be a more convincing and shorter path to market than is just supplying lasers.”

Optical Circuit Switching (OCS)

  • Hurlston on OCS contract: “In OCS, the multi-year, multi-billion dollar purchase agreement we recently announced ensures sustained long-term growth.”
  • Hurlston on additional wins: “We are really making progress now on sort of additional wins. I think it’s too early to call when we would be able to talk to those, but I would say that they’re quite sizable… They’re on the order of what we’ve talked to relative to this backlog that we’re seeing for 2027.”
  • Hurlston on the OCS tightrope: “We are definitely on a tightrope on this product line, right? It’s probably our biggest ramp… The big three ramps are these pumps, right? OCS and the high-powered lasers. So, we’ve got a lot of work on our hands, and the biggest single tightrope that we’re walking probably is OCS.”
  • Hurlston on Google relationship: “Google is obviously doing very, very well in the market. I would say that Google is driving a lot of demand on our business right there. They’re certainly one of our largest customers, and we’ve benefited greatly from that relationship.” [Some would argue that LITE is a proxy play on GOOG, so don’t need BOTH].

Long-Term Agreements

  • Hurlston on LTA structure: “We’re in active discussions right now on our pump lasers… we are talking to the major customers around trying to help, right? And put some skin in the game around the CapEx that we’re going to try to lay out, one, that can entail prepayment, that can entail take or pay, that can entail price increases.”

Conclusions on the Results round up so far

AGAIN, we have exhibited in the commentary above why we believe we have a highly exciting, huge opportunity, ultra growth portfolio. Combine that Portfolio that with a potentially improving Equity Markets, and an Era of Ai which is entering an exponential growth period, and the result is a very compelling position.

May 2026 NAV Total return is going well…so far.

Calendar 2026 YTD NAV Total return at 20 per cent now…

Our since inception annualised remains over 18 per cent in NAV Total return terms…

Our fantastic Dividend Yield

Remember, that on Friday you will get paid the new enhanced dividend per share of 20p per share, which would make an annualised rate of 40p. The share price sits at a discount of over 25 per cent to NAV per Share which means you can reinvest your dividend into a £ of assets for less than 75p in the £. The annualised dividend yield at 40p/932p = 4.3 per cent.

Perhaps the discount is your cyclical opportunity?

Key Manchester & London Updates

Please remember that all Fund based news is now posted to: https://www.linkedin.com/company/mnl-ln

Twitter will only see posts on Ai, Technology and the global Economy.

Key Tweets of the Month

The Long Portfolio

We regularly post the Portfolio to this site: https://www.linkedin.com/company/mnl-ln please do click the Follow button as we may stop posting it here too in this section.

The great Charlie Munger on concentrated portfolios:

<td valign="top"

Subscribe to our Newsletters

Each month we share the risks & opportunities we are watching across markets.

Subscribe