Bristol Gate Q3 Letter: Broadcom’s AI Pipeline Expands as Intuit Outlook Drags Performance
The dividend-focused U.S. Equity Strategy trailed the S&P 500 this quarter, delivering 15% dividend growth over the past year.
Overview
- Bristol Gate reported quarterly underperformance versus the S&P 500 Total Return Index while emphasizing 15% trailing 12‑month dividend growth.
- Broadcom posted fiscal Q3 2025 revenue of $16 billion, up 22% year over year, and disclosed a $110 billion backlog with more than half tied to semiconductors.
- Management highlighted a fourth major XPU customer with over $10 billion of orders slated to ship in Q3 2026, prompting expectations that 2026 AI revenue growth will exceed fiscal 2025’s 50–60% pace.
- Intuit was a key detractor after issuing FY26 guidance slightly below some consensus estimates, with EPS of $22.98–23.18 and revenue of $20.997–21.186 billion, alongside noted softness in Mailchimp and lower TurboTax units.
- Positioning with limited AI/TMT and Value exposure contributed to results, and the portfolio exited Marsh & McLennan and added Amphenol due to anticipated slower near‑term dividend growth at MMC.