Lakehouse Capital, a Sydney-based investment manager, published its “Lakehouse Global Growth Fund” investor letter for February 2026. A copy of the letter can be downloaded here. February proved to be a tough month for the Fund, mainly because of the ongoing “AI disruption” narrative. During this period, the Fund’s net value declined by 14.6% after fees and expenses, whereas its benchmark, the MSCI All Country World Index Net Total Returns (AUD), fell by only 0.4%. The Fund’s quality-growth investment style is facing pressure, especially in enterprise software, due to concerns over AI potentially replacing traditional software. However, the Fund believes that software companies with mission-critical enterprise platforms can leverage their strengths to thrive in an AI-driven world. Consequently, the Fund increased its holdings in companies that are more resilient than the market perceives. Despite the decrease in market value of the portfolio, the Fund believes that the fundamental growth of the holdings remains healthy. In addition, please check the Fund’s top five holdings to know its best picks in 2026.
In its first-quarter 2026 investor letter, Lakehouse Global Growth Fund highlighted stocks like ServiceNow, Inc. (NYSE:NOW). ServiceNow, Inc. (NYSE:NOW) is a cloud-based software company that provides a platform for automating and managing digital workflows. On April 15, 2026, ServiceNow, Inc. (NYSE:NOW) closed at $94.19 per share. One-month return of ServiceNow, Inc. (NYSE:NOW) was -16.84%, and its shares lost 39.01% over the past 52 weeks. ServiceNow, Inc. (NYSE:NOW) has a market capitalization of $98.52 billion.
Lakehouse Global Growth Fund stated the following regarding ServiceNow, Inc. (NYSE:NOW) in its Q1 2026 investor letter:
ServiceNow is a category leading US software business that automates complex corporate workflows across IT, HR, and customer service. It acts as a deeply embedded digital utility for the world’s largest enterprises, with 80% of the G2000 as customers and industry leading renewal rates around 98% – underscoring the mission critical nature of their platform. Recently, ServiceNow has experienced a significant drawdown due to the “death of software” and AI “seat contraction” narrative.
However, its quarterly results released at the end of January came in ahead of both its own guidance and analyst expectations. Revenues grew 19.5% in constant currency terms to US$3.6 billion and operating profit grew 31% to US$1.1 billion. Crucially, the company directly countered the AI “seat contraction” / AI “loser” narrative by disclosing monthly active users on the platform grew 25% year-on-year and that their new AI solutions hit US$600 million in annual contract value (ACV). This exceeded their US$500 million target set for 2025 and management also noted they are on track to exceed their US$1 billion ACV target for 2026…” (Click here to read the full text)
