The International Growth Fund returned +4.0% in April, behind the benchmark index which rose +7.9%.

Amazon (+27%) was the largest contributor. While its core retail business exceeded expectations, strength was driven by Amazon Web Services (AWS), where revenue reaccelerated alongside continued capacity investment to meet strong demand for AI and traditional cloud services. Amazon’s proprietary chips (Trainium and Graviton) support a differentiated full-stack AI offering, from silicon to application layer, with chip-related revenue already at a ~$20 billion run-rate. Margins also impressed, beating expectations across all segments. This was a broader theme across big tech. Alphabet (+34%), Amazon, and Meta (+7%) are demonstrating they can invest heavily in AI while still growing earnings, contrary to prior market concerns.

Healthcare holdings lagged amid a rotation away from quality and defensive sectors into higher-momentum areas. Investor concerns have centred on slowing medical device growth as procedure volumes normalise post-COVID and hospitals tighten capital budgets. However, underlying conditions remain more resilient than sentiment suggests. Procedure volumes are holding up across key categories, and hospital budgets and order books, particularly in robotics, remain solid. Edwards Lifesciences (+4%) and Intuitive Surgical (-1%) both saw revenue growth accelerate. Boston Scientific (-8%) is consolidating after several years of strong performance. While the company delivered 9% revenue growth in Q1, guidance was reduced due to near-term headwinds. Longer term, strong market positions, product innovation, and expected 2027 regulatory approvals, support reacceleration.

Danaher (-6%) reflects a slower recovery in biopharma spending, though biotech funding and pharma R&D trends suggest recovery is a matter of timing. We have reduced healthcare exposure over the past year while maintaining conviction in select high-quality names. Valuations have compressed to near 30-year lows relative to the broader market, creating an attractive opportunity for long-term investors.