As of Q1 2025, Terry Smith's Fundsmith portfolio shows continued strategic adjustments across holdings, reflecting a disciplined approach to managing a high-quality collection of global businesses. The $21B+ portfolio maintains its focus on companies with enduring competitive advantages, while recent activity suggests deliberate rebalancing and selective new additions.
1
META
Meta Platforms Inc.
Reduced 14.85%
Portfolio: 10.19%
Shares: 3,883,796
Reported Price: $576.36
Value: $2,238,464,663
Meta Platforms remains Fundsmith's largest holding despite a significant 14.85% reduction (-677,556 shares). As the parent of Facebook, Instagram, and WhatsApp, Meta continues to benefit from robust digital advertising growth and its ambitious metaverse initiatives, though the substantial trim may reflect valuation concerns.
2
MSFT
Microsoft Corp.
Reduced 13.20%
Portfolio: 9.17%
Shares: 5,370,162
Reported Price: $375.39
Value: $2,015,905,113
Microsoft, another core holding, saw a substantial 13.20% cut (-816,871 shares) this quarter. The tech giant's leadership in cloud computing (Azure), AI integrations, and enterprise software maintains its strategic importance in the portfolio despite this significant reduction.
3
SYK
Stryker Corp.
Reduced 4.96%
Portfolio: 8.59%
Shares: 5,069,187
Reported Price: $372.25
Value: $1,887,004,861
Stryker, a leader in medical devices and orthopedic equipment, remains a key healthcare holding despite a 4.96% reduction (-264,790 shares). Its diversified offerings across medical technology segments continue to align with Fundsmith's preference for businesses with consistent demand.
4
PM
Philip Morris International
Reduced 3.91%
Portfolio: 7.81%
Shares: 10,805,892
Reported Price: $158.73
Value: $1,715,219,237
Philip Morris climbed to become the fourth-largest position despite a 3.91% reduction (-439,283 shares). The tobacco giant's transition toward reduced-risk products and strong cash flow generation continues to make it a significant consumer staples holding in the portfolio.
5
V
Visa Inc.
Reduced 10.50%
Portfolio: 6.60%
Shares: 4,137,024
Reported Price: $350.46
Value: $1,449,861,431
Visa saw a substantial 10.50% reduction (-485,543 shares) but remains a top-five holding. The global payments network continues to benefit from the ongoing shift to digital transactions, though the sizable trim may reflect profit-taking after strong performance.
6
ADP
Automatic Data Processing Inc.
Reduced 9.97%
Portfolio: 6.28%
Shares: 4,513,899
Reported Price: $305.53
Value: $1,379,131,561
ADP, a provider of human resources and payroll solutions, experienced a nearly 10% reduction (-499,813 shares). The company's high client retention rates and subscription-based revenue model continue to align with Fundsmith's focus on predictable cash flow generators.
7
WAT
Waters Corp.
Reduced 0.59%
Portfolio: 6.06%
Shares: 3,613,197
Reported Price: $368.57
Value: $1,331,716,018
Waters, a specialist in analytical instruments for life sciences, saw only a marginal 0.59% reduction (-21,325 shares). The company's consistent revenue from pharmaceutical and laboratory clients reinforces its position as a core healthcare technology holding.
8
IDXX
IDEXX Laboratories
Reduced 0.55%
Portfolio: 5.06%
Shares: 2,648,331
Reported Price: $419.95
Value: $1,112,166,603
IDEXX, a leader in veterinary diagnostics, experienced a minimal 0.55% reduction (-14,524 shares). The continued growth in pet ownership and increased healthcare spending on animals maintains the company's appeal as a defensive healthcare play.
9
GOOGL
Alphabet Inc.
Reduced 0.07%
Portfolio: 4.82%
Shares: 6,843,213
Reported Price: $154.64
Value: $1,058,234,458
Alphabet remained largely unchanged with just a 0.07% reduction (-5,065 shares). Google's parent company continues to be a crucial technology holding, with its dominance in digital advertising, cloud computing growth, and AI innovations supporting its position in the portfolio.
10
MAR
Marriott International
Reduced 0.09%
Portfolio: 4.61%
Shares: 4,251,560
Reported Price: $238.20
Value: $1,012,721,592
Marriott International saw a negligible 0.09% reduction (-3,780 shares). The global hospitality leader rounds out the top ten holdings, offering continued exposure to the travel and leisure sector as global tourism maintains its recovery trajectory.
1
Significant Trimming of Tech Leaders
The most substantial reductions occurred in top technology holdings, with Meta cut by 14.85% (-677,556 shares) and Microsoft reduced by 13.20% (-816,871 shares). These moves likely represent disciplined profit-taking after strong performance, rather than a fundamental shift away from technology exposure. With these stocks still commanding the top two positions despite the reductions, Terry Smith continues to demonstrate conviction in companies benefiting from digital transformation while prudently managing position sizes.
2
Strategic Additions and Growth Areas
Q1 2025 featured notable additions and expansions, including a dramatic 1,020% increase in Zoetis (+2,319,158 shares), making it a new significant position at 1.91% of the portfolio. Texas Instruments saw a 60.28% increase (+1,025,182 shares), growing to 2.23% of the portfolio. New positions in Catalyst Pharmaceuticals and Intuit indicate Terry Smith's willingness to explore new opportunities in specialty pharmaceuticals and financial technology, while maintaining his focus on quality businesses with strong competitive advantages.
3
Sector Balance and Defensive Positioning
The portfolio continues to balance growth and defensive sectors, with technology (Meta, Microsoft, Alphabet), healthcare (Stryker, IDEXX, Waters), and consumer staples (Philip Morris, Procter & Gamble) representing the core allocations. The significant expansion in Zoetis enhances exposure to the resilient animal health sector, while maintaining Philip Morris as the fourth-largest position reflects a continued commitment to businesses with strong cash flow generation regardless of economic conditions.
17
ZTS
Zoetis Inc.
Increased 1,020.18%
Portfolio: 1.91%
Shares: 2,546,487
Value: $419,279,085
Zoetis saw the most dramatic change this quarter with a 1,020% increase, adding over 2.3 million shares. This major expansion signals strong conviction in the animal health leader, which benefits from increasing pet ownership trends and veterinary spending.
16
TXN
Texas Instruments Inc.
Increased 60.28%
Portfolio: 2.23%
Shares: 2,725,812
Value: $489,828,416
Texas Instruments received a significant 60.28% boost with over 1 million shares added. The semiconductor company's focus on analog and embedded processing aligns with Fundsmith's preference for businesses with strong recurring revenue and high margins.
21
INTU
Intuit Inc.
New Position
Portfolio: 0.51%
Shares: 181,628
Value: $111,517,776
Intuit represents a new addition to the portfolio, bringing exposure to financial software. The company's QuickBooks and TurboTax products create significant moats through high switching costs and strong brand recognition, matching Fundsmith's quality criteria.
35
CPRX
Catalyst Pharmaceuticals Inc.
New Position
Portfolio: 0.24%
Shares: 2,151,274
Value: $52,168,395
Catalyst Pharmaceuticals represents an interesting new specialty pharma position focused on rare diseases. This smaller allocation suggests Terry Smith is exploring opportunities in the biotechnology space while limiting overall exposure as he builds conviction.
Terry Smith's Q1 2025 portfolio reflects a methodical approach to position management, with targeted reductions in large technology winners balanced against strategic expansions in selected areas. The significant cuts to Meta (-14.85%) and Microsoft (-13.20%) demonstrate disciplined profit-taking, while the dramatic increase in Zoetis (1,020%) and addition of Intuit reveal ongoing portfolio refinement.
While maintaining the core philosophy of investing in high-quality businesses with sustainable competitive advantages, the Q1 adjustments suggest an evolution toward broader sector diversification. The substantial growth in animal health exposure through Zoetis and the new position in financial technology via Intuit indicate Smith's approach to finding quality businesses across a wider range of industries. These moves, alongside the continued commitment to companies with robust cash flows and strong returns on capital, reinforce Fundsmith's long-term focus on owning exceptional businesses rather than attempting to time market cycles.
