Apple (AAPL) Underweight Position Weighs on Relative Performance of Sands Capital Technology Innovators Fund as Shares Rally

Sands Capital Management, LLC's Technology Innovators Fund released its Q4 2025 investor letter for "Technology Innovators Fund". A copy of the letter can be downloaded here. The Fund delivered mixed performance during the fourth quarter of 2025, as market returns were increasingly driven by a narrow group of large-cap growth stocks, with the portfolio’s top ten holdings accounting for roughly 59% of assets, while several high-valuation innovation names faced pressure from slowing momentum and investor risk aversion. The fund’s results reflected stock-specific challenges rather than broad macroeconomic shocks, with weaker performance in certain emerging technology holdings offset by strength in select platform and infrastructure businesses. During the quarter, the portfolio declined 6.3% on a quarter-to-date basis, and the fund generated a 14.7% return over the one year, reflecting stock-specific challenges rather than broad macroeconomic shocks, with weaker performance in certain emerging technology holdings offset by strength in select platform and infrastructure businesses. Management emphasized its long-term investment horizon, noting an average annual portfolio turnover of 21%, and stated that many portfolio companies continued to generate solid full-year earnings growth in 2025, supported by durable revenue models tied to artificial intelligence, cloud computing, and digital transformation, even as enthusiasm for speculative growth faded late in the quarter. In addition, please check the Fund’s top five holdings to know its best picks in 2025.

In its fourth-quarter 2025 investor letter, Sands Capital Technology Innovators Fund highlighted stocks like Apple Inc. (NASDAQ:AAPL). Apple Inc. (NASDAQ:AAPL) is a global consumer technology company known for its iPhone, Mac, and services ecosystem that drives consistent revenue and strong customer loyalty. The one-month return of Apple Inc. (NASDAQ:AAPL) was 0.10% while its shares traded between $169.21 and $288.62 over the last 52 weeks. On February 13, 2026, Apple Inc. (NASDAQ:AAPL) stock closed at approximately $255.78 per share, with a market capitalization of about $3.76 trillion.

Sands Capital Technology Innovators Fund stated the following regarding Apple Inc. (NASDAQ:AAPL) in its Q4 2025 investor letter:

"The portfolio’s underweight to Apple Inc. (NASDAQ:AAPL) was the largest driver of relative underperformance within the Magnificent Seven. Apple shares gained despite slower AI progress, helped by signs of an iPhone upgrade cycle and a more measured approach to AI investment, which appealed to investors amid questions about the near-term return on infrastructure spend."

Apple Inc. (NASDAQ:AAPL) is in 8th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 166 hedge fund portfolios held Apple Inc. (NASDAQ:AAPL) at the end of the third quarter, which was 156 in the previous quarter. While we acknowledge the risk and potential of Apple Inc. (NASDAQ:AAPL) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Apple Inc. (NASDAQ:AAPL) and shared the list of the most profitable mega cap stocks to buy. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.